All Forum Posts by: Scott Wolf

@Thiago Oliveira, the $1,200 upfront fee is a major red flag for me.  Unless it's a point going into the loan paid at closing, I would not pay it.  To echo @Tchaka Owen, the 5% interest rate also raises red flags, as it seems too good to be true, unless you have a super low LTV.

@Caleb Chuku, what you're talking about sounds more like an equity investor than a private lender.

A private lender will be much more profitable to you, as opposed to giving away your equity. 

Based on what you said, it seems like you're looking at a buy and hold.  If someone is coming in 50-50 and you want to do a straight equity split, it is usually the easiest way to do things, or split based on what the equity contribution is.  

If it's a private lender, depending on how close of a relationship you have, 6-12% is typically the return people are looking for.

@Glenn Brathwaite, if you need to be within commuting distance of NYC, then NJ, Westchester (Yonkers/Mount Vernon), or even the Bronx may offer good options for you.

Happy hunting!

@Adam Craig this is where you should work with a commercial mortgage broker.  If anyone has the connections, they would know.  If a ground-up development deal can get funding, there's no reason a vacant building with a solid lease-up plan, and someone with a history of completing these deals shouldn't be able to find funding. I'm sure some of the brokers in my network may be able to assist.

@Tyler Johnson, you could find a private lender, or many larger firms offer DSCR loans. Civic and RCN are two that come to mind.

@Alex Smith, him paying cash will only add transactional costs to this process. Have him be a private lender to you at 0% or 1% interest with 100% LTV, so you purchase the property. Not sure what gifting the money to you has to do with anything.

@Alex Smith, what does your FIL get out of this?  There isn't any benefit in your initial post. In fact, with closing costs, he will have lost money on the deal.

Disregarding that fact, the simplest thing to do is have you buy the house and have your FIL provide you with 100% financing for the purchase.  Then you can refinance after the rehab without adding additional transactional costs for your FIL.  Will you be renting it out, or living in it?

@Kevin W., to add to what @Jay Hinrichs said, you will also find hard money lenders saying they are private lenders.

You should go to local REIA's and speak with friends and fam that are may have money or are already in the RE industry.

@Nick Louie, in NY an atty. typically handles the writing of the contract.  I can recommend a few that deal in the Brooklyn area and have experience with under renovation properties.

Let him know I sent you!