All Forum Posts by: Raheel Naviwala

@Raul Martinez

That may be true but they will still see the huge increase in my company commission from 25% to 50%. I think I am going to increase it gradually as I build a better track record. 

I got in touch with another hard money lender just now and his terms were 60% of purchase price at an 11% annual interest rate. That is much favorable than the first guys I talk to asking for an initial fee of 5% of the loan, which is huge. Seems like HML might be the way to go, I just need to shop for the most favorable terms.

@Brian Ortins

I doubt they will go for the annual percentage return since we already have this arrangement setup that benefits them way more, and they know I kind of need them. Also, with the way the company is structured, I am not liable at all. If I lose, they lose. Whereas, the annual percentage return can put me in jeopardy if a deal goes sour. A 50/50 split would be perfect but I don't think only 3 houses is enough to justify such a big increase. I would be out of business if they were to back out right now. Maybe I need to keep it going the way I already am and be patient until I have a solid amount of funds myself and a more proven track record. I just recently heard of HML and it intrigued me. Figured it was worth a chance of posting it on here for some clarity. Wish a perfect lender would just come across. @Darrell Shephard seems to be getting great deals. Maybe I need to search more

Jeff, raising the company commission would be ideal. But these are friends and family that took a gamble with me on my venture so I feel wrong to increase my rate. I guess there is a threshold where business trumps relationships but I don't think I am close to that level yet. I guess in the future. I guess I will explore doing one property with a HML and keep doing what Im doing for now and see where it takes me. I should have enough funds in the next year or two to fund my own projects and go more towards margin than volume. Because, as of now, volume is the only way to go

Darrell, after crunching the numbers, I can make almost double if I do the hard money loan. But I am scared to do it in case the property doesn't sell as fast I anticipate it to, where I will accrue interest. Plus I would not want to mix my investors money with a HML so I would actually be taking more of a risk with my own funds in the worse event of me defaulting. I doubt that will happen but I have to prepare for the worst.

Ryan D., that is the average return on each property which takes me 3-4 months so the annual return I am giving them is more like 42-56%!

I have been flipping homes for the past year and have successfully done 3 houses making good profit. My LLC has a private investor pool (friends and family). We use their money for all costs and then sell the house for a premium. After selling, my company takes a 25% commission from the profits and distributes the remaining profits back to the investors according to how much they put in. I have been averaging a 14% return to them within 3-4 months. I am searching ways to get the money cheaper so I can get more of the profits. Is hard money lending a good idea? I have been doing research and crunching numbers and seems like it will only be worth it if I can get an amazing lender (I guess that goes for everyone). I have two pending properties that need minimal rehab with great profit margins which I would like to get the most out of. Can anybody recommend a good HML? Ideally 65-70% After Repair Value, not on purchase price. I am in South Florida. I met one guy so far that would do 60% of purchase price and 15% annually with 5% of the initial loan as a fee. They don't make much off the interest since I'm flipping within 90 days but the initial fee still seems high. If they evaluated according to after repair value and not off purchase price it would make a huge difference. Am I being greedy? Please help!