All Forum Posts by: Nnabuenyi Anigbogu

Sry Double post

Welcome to the site. It is good to see another Chicago Investor on here. Make sure to utilize the site to its fullest and take advantage of all the information provided.

Its pretty straightforward. If you are refinancing at 70% of ARV then you should be getting cash back from the bank if you purchased it originally with private or hard money. Assuming you bought the property right you will have enough cash from the bank to give the lenders that you owe.

I don't know if i would call HMLs unsophisticated but i do see Bill's point as to how they are less sophisticated. There is no way i can compare the level of due diligence done by a bank to that done by a HML. That is also why it is easier to get a HML compared to a bank loan. The scrutiny i have had to go through just to get a HELOC is nothing compared to what i have gome through with HML's. Even multinational successful ones.

I use the smartmove website which is linked to in the resources tab of this website. It allows you to have the tenant pay for the screening an provides you with the background check and credit report.

You will however have to do the landlord and employment checks yourself.

@Upen Patel  I would like to also know if this is something all banks do. I will be in the market for a 2-4 unit in 2-3 months and would love to go the route of getting fully approved prior to placing a property under contract.

 Most definitely agree. However in my case i have both because without my 50/50 partner i can't do the deal. He is the GC/Project manager/Expediter/Permit getter/ Layout generator/ Deal finder/ and all around house buider etc. hahaha. I am using this opportunity to learn the construction side from him.

So for me especially with a full time job, it makes sense to use a HML and also only get 50%of the profit than to do it all myself with a HML and mess up the deal. Also my experience is more in buy and hold and not flipping.

For those newbies i would recommend the same route if you have little or no experience.

@Trina C. Just some advice on HML. There point system will always seem extremely high to you no matter what. Even the legit ones have high points. I see between 4 and 6 for most. There is a reason they are called HARD money. It is also much worse if you dont have at least a couple of deals under your belt because you are seen as a bigger risk.

However, all you have to do is price in the points to whatever deal you are doing to see if it works. I am paying 5pts and 14%to my HML for the flip i am doing. However i am slated to make about 70-80K in profit (gut rehab) even after accounting for the points and interest (it will be 30-40k in the end since im splitting profits 50-50 with a partner) To that effect i am using it because i did not have the cash and not enough private money but it was a great deal. As i gain more track-record i can get more private money and use less HML.

@Account Closed lol. Sometimes it seems to me that people talk to each other but are on different plains. I tried to resist jumping in but could not help myself. I always learn something new though so its good.

@Trina C. Your latest post conveys that fact and makes complete sense to me. There are bad actors within the HML world and it isnt for everybody. I was addressing your initial posts where you made a broad based assertion as opposed to an opinion backed by your personal experiences. Unfortunately you posted right before i did so it seemed i was addressing your latest post.

I am glad you have not ruled them out because i believe you should have an arsenal of funding and use whatever makes sense for the deal. Good luck with your investing.