All Forum Posts by: Nghi Le

Can you help us understand the numbers? 

Purchase price

Rehab spent

Rehab remaining

ARV

As-is value

Payoff

There also may be an opportunity for another investor to buy you out. But again, the numbers would dictate that.

These days, the Greater Seattle Area has an average of 3 real estate meetups per night, but what about those who can't attend evening meetups due to work schedule, family obligations, etc? Then this is the perfect meetup for you!

There are no speakers or pitching, just pure networking. Whether you're working a day job in the area or are lucky enough to work in RE full-time on your own schedule, come join us for lunch and networking.

We're averaging about 70 people per meetup in this location and raised over a thousand dollars for a charity called A Hero's Home through the meetup fee. This charity is dedicated to providing homes (acquired and fixed up by proven real estate investors) to those who have served their communities and country; it was brought together by a few BP stars, such as Jay Hinrichs, Brian Burke, Chris Clothier, Brandon Hall, etc.  For more details, please visit: http://aheroshome.org/

Since the rain is back, we're moving our location to the 2nd Floor's Great Room in the same building (Two Lincoln Tower). We can still fit the same capacity of people, and also have a shuffleboard and pool table. Parking is free in Lincoln South parking lot for up to 3 hrs if you validate with any store in Lincoln Square.  Here's a picture of what the new location looks like:

The fee is $15/person, which will cover the food and contribute to the charity. We'll take care of the fee for the location.

Please RSVP so we can get an accurate headcount for food:
https://www.meetup.com/RealEstateAtWork/events/255334548/

Keywords: Redmond, Kirkland, Woodinville, Renton, Factoria, Newcastle, Mercer Island, Issaquah, Sammamish, Factoria, Tacoma, Everett

Pictures from the previous event:

No, I was talking about a full commercial bank loan.  Not as bad as a conventional loan, but still a bank.  They don't require seasoning of income though, but they'll definitely look at tax returns.

I think anything more than 2pts for a long-term loan is pretty tough to swallow, especially at 8%.  Might as well go hard money at that point and avoid the headaches.

@Rick Pozos Seems like pretty standard offerings for a local HML. With the national guys, I've seen rates drop to the 7's and 8's with points as low as 1% for experienced investors. But it is often more of a headache working with the national guys than the local ones, that's for sure.

@Paul Quinones

I may be able to help.  Can do either hard money or commercial (the latter would be a lot cheaper), depending on if the properties are stabilized and currently cash-flowing.  Is this in IL?

@Rick Pozos Curious, what kind of great rates are the local lenders in TX giving?  I tend to be of the other mindset and primarily use national lenders.

@Patrick S. From what I've seen of HMLs that do non-recourse lending, typically it's a lower LTV and higher interest rate.

Aside from the fact that HML will not lend to owner-occupied properties, they also don't tend to like small loan amounts. When you ask for <$100k, you've already eliminated half of the pool. Under $75k is another half. And then under $50k is maybe a couple. Will those couple of HMLs lend to someone with no or low credit? That's the other tough task.

Since you're going to need to move out anyway once you sell the house, perhaps move out earlier so that it's no longer owner-occupied?  Then ask for a hard money loan over $50k.

The other option would be to find a private lender, or as someone else mentioned, sell it as-is.

@Rudy Bello @Peter S. @Jose G Delvalle Bueno

Feel free to PM me.  There's a lot more to hard money than just rates and down payment.  I've probably spent over 1,000 hours talking to lenders so far this year.

There are a lot of things to consider with hard money.  There is no perfect one out there that has everything you want, so you have to pick and choose what's more important to you (i.e. cheaper rates, lower down payment, faster closing, easier to work with, better draw processes, etc).  Unfortunately, for someone who doesn't have much experience, you'll be getting everyone's worst terms and don't have much negotiation power.  Best terms I've seen for a new investor are 10-12%, 2-3 pts, 10% down, and 1-yr term.  You should never have to pay more than 12% and 3pts though.

@Jason D. You seem like a very seasoned investor.  I didn't find MoFin to be very competitive; I'm curious how many different HMLs you've used as your basis for comparison?  George is a nice guy though.

Also agreed that most people should stay away from DoHardMoney, although there is a HML for everyone...

@Scott Moulton I have to correct a few things from what you said.  First, banks and hard money don't typically play in the same space.  Reasons you'd use hard money:  faster closings, less headaches, property or investor doesn't qualify for financing, or you want to make a more competitive cash-like offer.

I work with LendingHome quite often, both as a borrower and as one of their few remaining brokers. They don't offer a 6-month product (only 12-months), and they will not lend up to 80% of ARV; I don't know any HML that lends that high. They typically range from 65% to 75% of ARV. LH will do up to 70% of ARV for Tier 3-4 borrowers and 75% for Tier 1-2 (more experienced investors), and that's if you borrow rehab from them, otherwise, subtract another 5%. After you have one flip under your belt, they'll lend 90% of purchase and 100% of rehab.

8% is very low for new investors, and 12% and 3pts isn't bad for 100% financing.  If those options are real, that seems to be the better way to go.  Rates and terms are one thing, but the ability to close on time is what makes or breaks a good lender.

Also, I don't know any HMLs that care about DTI. That seems more like a bank.

Sorry for stepping onto here a little late; I'm not as active on BP as before.  Appreciate the tag, @Trent Parker !

Nicholas, feel free to ask me anything about hard money.  I've borrowed from at least 20 of them over the past 3 years, half of them being the local guys like Veristone, Eastside, Redmond Funding, Intrust, Builder's Cap, Inland, etc.  There is no "best" lender that has it all and it really depends on the situation.  Some are faster than others, cheaper, easier to work with, better draw process, etc - these are all good points for consideration.  I wrote a blog post about how to compare different HMLs (and what to watch out for); you can find it in my profile.