All Forum Posts by: Account Closed

Nice job on the deal Shiela! I think these numbers you have provided are a bit off though if you did buy it for 10 dollars and sell it for 800k, please call me when you find the next one like that :P 

 Yes! 

Nice work! if you are looking to accelerate your business, I would love to connect. I do a bit of lending out in your area and same with a few of my lender buddies. 

Hey Leanne, Of course you would be allowed if the budget went over, but keep in mind your ARV. If you plan on working with this lender long term they will want to see that you are accurate with your ARV estimates and that you are close with your scope of work.

Hello Quinton! if you can get the square feet you can make a general estimate that rehab will cost 20 dollars a square foot for "light rehab" think paint and carpet etc, while heavy rehab will be closer to 50 dollars a square foot. 

 That sounds about right, I would make that loan! (depending on the repair scope of work and cost).

Congrats! Good luck with the project

I wouldn't lead with "I'm looking to compare rates". As a private lender, I want to work with experienced flippers who want to build a relationship with me, and can count on me to be flexible when they need me. If you are concerned about getting the lowest points/interest possible, consider that you may be being penny wise and pound foolish when it comes to business connections. the stronger your relationship with private lenders generally the better terms you can get, and the easier your life with be in respect to getting loans. 

I hope this shifts your perspective a bit! 

Hey David! 

Here are a few questions to ask a new borrower, after you meet them. Lots of good comments here on how to meet borrowers, but once you meet them they should be able to explain the deal. Additionally, you should ask: 

Why do they like the deal?

Summary of the scope of work? Is this a heavy rehab? 

Expected duration of the deal check to check and why? (check to check is just when you 

Who is managing it? Do they have staff for managing contractors or are they doing it themselves? 

Talk about comps in the neighborhood? Do they have accurate comps that are similar? 

Purchase price what’s the deal?

Where is value being created? (value add, or below market purchase?) 

If the borrower can’t do this, they are probably a "noob" and you should likely walk. As mentioned in a few comments, we don't want people experimenting with our money! 

Also here are a few "never do's" to help you understand the risk: 

Never do deal if the property can’t be valued properly (no comps no deal)

Never do a deal without a third-party escrow

Never assume the third-party vendors will not make a mistake (deals take longer then planned, watch out for scope creep)

Never do a deal without property insurance

Never do a deal on owner-occupied (there are laws that can get you in trouble here)

Never do an unsecured loan

Be careful when you say "rapidly appreciating". Recent Market data shows a slowing in the housing market here in SD.