All Forum Posts by: Stanley Yeldell

Katryna, finding a private lender for a primary residence can be tricky since most private lenders and hard money lenders focus on investment properties. However, here are a few strategies to explore:

1. Local Real Estate Investor Networks – Join local REI groups, meetups, or Facebook groups where private lenders may be open to funding primary residences under the right terms.

2. Seller Financing – If the seller is open to it, you could negotiate a seller-financed deal where they act as the lender.

3. Community Banks & Credit Unions – Smaller local banks may offer portfolio loans with flexible terms.

4. Wealthy Individuals / Family Offices – High-net-worth individuals sometimes fund private deals, especially if they see strong equity and repayment potential.

5. IRA or Self-Directed Retirement Accounts – Some investors lend money from their self-directed IRAs for real estate transactions.

Since you’re willing to pay higher interest for a short-term solution, a contract for deed (land contract) might also be an option, where the seller keeps the title until you pay it off or refinance.

Would you like me to connect you with any potential private lenders?

Shane, buying "subject to" in Illinois is possible, but the state has stricter regulations around real estate transactions. Here are some key things to consider:

1. Find a Sub-To Friendly Title Company or Attorney – Illinois is an attorney-close state, meaning real estate closings are typically handled by attorneys, not title companies. You’ll need a real estate attorney experienced in creative financing.

2. Land Trusts for Extra Protection – Many investors in Illinois use a land trust to hold title when doing subject-to deals. This can help avoid triggering the due-on-sale clause.

3. Disclosures & Compliance – Illinois has strong consumer protection laws. Make sure to provide clear disclosures to the seller about the risks involved, especially regarding the existing mortgage staying in their name.

4. Insurance Considerations – You’ll need to work with an insurance agent who understands sub-to deals, as the lender might require a policy that keeps the seller as the named insured.

5. Due-On-Sale Clause – While banks rarely call loans due, it’s still a possibility. Structuring the deal properly (like through a land trust) can reduce this risk.

Your best bet is to connect with an Illinois investor who has successfully done sub-to deals or find a local real estate attorney who specializes in creative finance. Would you like some referrals or help finding an attorney in Peoria?

Hey Jimmy, sounds like a solid project with good cash flow potential. Here are some financing options to consider:

HELOC or Cash-Out Refi on Another Property – If you or your mom have equity elsewhere, this could be a more flexible and lower-interest option.

Business Line of Credit – Since the property is in an LLC, you might qualify for a business LOC, which could cover construction costs.

Private Money Lender – If you’re okay with 12-15% rates, a private lender could fund this as a short-term loan, especially if the guesthouse will generate strong income.

Construction Loan – Some lenders offer short-term construction financing, which converts to a longer-term mortgage once completed.

Seller/Partner Financing – Bringing in an investor or structuring a joint venture with someone willing to fund the build in exchange for a share of the income.

Credit Card Stacking or Unsecured Business Loans – Riskier but could work if you need to bridge a gap until the unit starts cash flowing.

Would love to hear more details—especially your timeline and expected rental income. Happy to brainstorm further!

Hey Jesse, sounds like a great opportunity, especially with the long market time. Here are some creative financing options you might consider:

Seller Financing – Since the seller hasn’t moved the property in years, they might be open to carrying a note. You could structure a low down payment with interest-only payments for a set period, then refinance later.

Master Lease with Option to Buy – Control the property now, generate cash flow by leasing it, then buy once it's stabilized.

Sub-To or Wrap Mortgage – If there’s existing debt, you might be able to take over payments or structure a wraparound mortgage to benefit both parties.

Hard Money or Private Lender for Reno Costs – If you secure a seller-financed deal, you can use private or hard money for the rehab without tying up your own capital.

BRRRR Strategy with a Bridge Loan – If you can get the purchase price down, use a bridge loan for acquisition and rehab, then refinance with DSCR or conventional financing.

Would love to hear more details to help structure something solid. Let me know how negotiations go!

Hey TJ, you're in a great spot already with disciplined savings! If you're looking for ways to accelerate, consider these options:

Seller Financing – Some sellers may finance a portion of the purchase price, reducing your need for a large down payment.

DSCR Loans – These loans focus on property cash flow rather than personal income, often requiring only 15% down.

Private Money Lenders – If you can find a PML willing to work with you, you may be able to put less down.

Partnerships – If you’re open to splitting profits, you could bring in a partner who funds the down payment.

Since you’re okay with the slower path, just keep stacking cash, but these might be worth exploring to move faster!

Hey Jesse,

This property sounds like a great opportunity, especially given the long time on the market and the potential for creative financing. Here are some strategies to consider:

1. Seller Financing Options

Since the seller has struggled to move the property, they may be open to creative terms:

Low or No Down Payment with Seller Carryback: Offer a seller-financed deal with a low down payment and interest-only payments for a set period until renovations are complete and cash flow starts.

Balloon Payment: Structure a deal where you pay interest-only for a few years and refinance or pay a lump sum at the end.

Master Lease Option: Lease the property with an option to buy, using rental income to cover expenses and fund renovations.

2. Financing for Renovations

Since the property needs a full gut job, consider:

Hard Money or Bridge Loan: Short-term funding to acquire and renovate, then refinance with a long-term loan.

Private Money Lenders: Individual investors willing to finance the deal for a fixed return.

FHA 203(k) or Conventional Renovation Loans: If you qualify, these loans roll rehab costs into the mortgage.

3. Negotiation Leverage

The long market time gives you leverage—consider making a lower offer with seller financing.

Point out the high rehab costs to justify better terms.

Offer flexibility (quick closing, interest on seller financing) to make it attractive to the seller.

Final Thoughts

Your best bet might be to negotiate seller financing for acquisition and use a rehab loan or private lender for renovations. Once stabilized, you can refinance with a DSCR or conventional loan.

Would love to hear more details—are there existing tenants, and what's the potential ARV?

Good luck!

Hi Scott,

It sounds like you're in a great location for mid-term rentals! To determine if there’s a market at the hospital, I'd recommend reaching out to the hospital's housing coordinator or human resources department, as they often handle temporary housing for traveling medical staff or out-of-town employees. Another option would be to connect with the hospital's administrative offices, as they may have partnerships with local landlords for these types of accommodations.

Regarding utilities, in mid-term rental situations, it varies. Some landlords include utilities in the rent, while others may pass them on to tenants. Given the short-term nature of mid-term rentals, including utilities can make your property more attractive to potential tenants, but it’s essential to factor that into your overall rent pricing.

The best way to go about this is to ensure your listing is visible to your target audience. Websites like Furnished Finder and even hospital or university housing boards could be good starting points to market your property. Additionally, it’s a good idea to network with local real estate agents who specialize in short-term or mid-term rental markets.

Good luck with your new venture!

Hi everyone,

I’m a new private money lender (PML) looking to get involved in real estate deals. I have available capital and am interested in funding smaller, long-term investments, particularly for single-family homes and duplexes in rural or less competitive areas. My goal is to provide financing for down payments or bridge loans, especially in owner-financed situations.

I’m excited to connect with real estate investors looking for funding and learn more about the process of lending in this space. If you’re an investor or someone who has experience with private lending, I’d love to hear your thoughts or any advice you may have as I get started.

Looking forward to connecting!

To find private investors, especially individuals for real estate deals, here are a few options:

1. Networking Events: Attend local real estate investment clubs, meetups, and industry conferences. In-person interactions are great for building trust with potential investors.

2. Real Estate Platforms:

   • BiggerPockets: A robust platform for connecting with private lenders and investors.
   • Fund That Flip, PeerStreet, Groundfloor: Online platforms connecting investors with real estate projects.

3. Social Media Groups: Facebook and LinkedIn groups dedicated to real estate investing often have private investors or lenders looking to connect.

4. Personal Network: Often overlooked, but friends, family, and colleagues may know individuals interested in investing.

5. Private Money Brokers: If you're working on wholesaling deals, you may find brokers who have established relationships with private money lenders.

6. Real Estate Agents: Some agents have connections with private investors, especially those focused on investment properties.

For your 50% LTV, it's good to approach investors who may be interested in lower-risk, high-equity deals.

Key Factors for a Good Seller-Financed Deal

1. Cash Flow: Rental income should exceed monthly payments (PITI) by at least 1.25–1.5x.
2. Purchase Price: Compare to ARV and market value for fair pricing and equity potential.
3. Interest Rate: Aim for competitive rates; higher rates must still allow positive cash flow.
4. Amortization/Balloon Terms: Favor longer amortization and align balloon payments with your exit strategy.
5. Down Payment: Lower upfront costs reduce risk but should meet the seller's expectations.
6. Flexibility: Seek no prepayment penalties and fair late-payment clauses.
7. Property Condition: Ensure the property’s condition matches terms through inspections.
8. Seller Motivation: Assess the seller’s willingness to negotiate favorable terms.
9. Exit Strategy: Have a clear plan for refinancing or payoff at term end.
10. Portfolio Fit: Ensure the deal aligns with your financial goals and risk tolerance.

Vetting multiple deals and consulting professionals is crucial to making sound decisions.