All Forum Posts by: Michael Kinsella

@Jiwon Lee

A few starting points to find them...

1. Network --> Hard Money Lenders tab on BiggerPockets

2. Local REIA events. You can often meet HML reps and some private individual lenders as well.

Best to have multiple options in my opinion.

I know there is hard money, private money, bank financing. My 1st thought is to go through bank financing, however it seems a little more difficult to obtain with the properties needing so much work.

This is generally true. The advantage of working with a bank is a lower cost of capital than you would pay with a HML. The disadvantages are a more cumbersome process and more stringent financing guidelines.

My fear is that the investor will not take me serious if I do not have financing in place. What are some of the ways to place these properties under contract? Would a letter of intent be sufficient? Do I need to place an offer with inspection contingencies? I know it will ulimately be up to me, just looking for ideas on approach.

A proof of funds from a lender and/or pre-approval may be helpful in this situation. Not all lenders can provide one, but some can based on your liquidity.

@Daniel Botvynko 

Listen to @Tom Shallcross, he, unsurprisingly, nailed it.

@Galen Heckathorn Nice!

Sounds like a profitable, productive experience.

Any plans for future projects?

@Tasha Barnes

Two good starting points...

1. Network --> Hard Money Lenders tab on BiggerPockets where you can filter by state.

2. Local REIA events where you can network with other investors to get referrals and also meet local HML reps.

As a newbie, you will need to turn over more stones, i.e. speak with more lenders, to find financing options.

@Nathan Eaton Got it. Nice!

You can search for HMLs by state under Network --> Hard Money Lenders on BiggerPockets.

Going to local REIA events will probably be your best bet with regards to meeting private lenders.

@Jerome C Brown

As @Taylor Dasch suggested above, a private individual lender would be more willing to loan on smaller amounts.

The issue for HMLs at those dollar amounts is that foreclosure/legal costs make loans that small not worth it to them.

You may be able to find a private lender at a local REIA event - it should be someone you trust.

@Josh Boyd A realtor should be able to give you a good idea.

Appraisers will look at properties that have already sold recently, so you'll want to stay away from active listings.

Characteristics such as SF, bd/br count, and proximity to the subject property should also be looked at.

I was wondering if you can use a DSCR loan for flipping?

No. A DSCR loan is intended for stabilized properties. 

Does anyone use this loan for flipping?

No. Investors will often use banks or HMLs who offer loan products specifically designed for a fix and flip.