I am very new and am beginning to learn about becoming a hard money lender for small investments like flips, etc... and when I go to investor marketing events I often get discouraged by hearing about how people are trying to invest without having any skin in the game.

That's why self-showings are gaining popularity.As @amanda bryant mentioned, you want them to have some skin in the game.Easiest?

The property serves the energy workforce market in the area.Property overview• 18 furnished units + manager residence• Built in 2017• Located in Pecos, TX• Workforce housing model (weekly/monthly rentals)• Stabilized operationsFinancials• Purchase price: $800,000• Recent third-party appraisal: $1,200,000• Trailing normalized NOI: ~$100,000• Annual revenue: ~$268,000So from a leverage standpoint, the deal is actually fairly conservative if viewed against value.Loan requestWe’ve been seeking:• Senior bridge loan: ~$520,000• 65% LTV of purchase price• Interest-only• 12–24 month term• Exit: refinance into long-term DSCR loan once stabilized furtherSeller structureSeller is flexible and willing to carry the remainder.Proposed structure:• Senior loan: $520K• Seller carry: $280K fully subordinatedSeller note terms could be:• principal-only monthly payment ($1,200–$1,500)• balloon at refinanceSo the deal itself works operationally.Where things get difficultWhat I’ve encountered talking to lenders:1️⃣ Most bridge lenders want borrower cash in the dealEven with seller carry, they want "skin in the game."2️⃣ Many lenders underwrite strictly off purchase price, not appraised value.3️⃣ Origination fees are extremely highTypical quotes I've received:• 12–14% interest• 5–6 points origination• 12-month term4️⃣ Some lenders require reserves ($100K+), which defeats the purpose of the structure.5️⃣ DSCR lenders generally say:“Come back after seasoning or after you own the asset.”The real gapThe deal works if the capital stack is:Senior loan: $520KSeller carry: $280KBut lenders are effectively asking for an additional $50K–$100K borrower cash injection, which is the piece I’m trying to solve.So my question to experienced investors:Where do people typically source that “gap” capital in deals like this?

The key isn't just how you fund the entry, but how quickly you can execute the "Refinance" to pay back that line of credit.From a Balance Sheet lending perspective, we see many investors use HELOC funds as their "skin in the game" while leveraging a Bridge or Rehab loan to cover the purchase and renovations.

Hey Brandon, Most HMLs will lend in 1st position and may require at least 10%-5% skin in the game if you are combining both.

Private lenders want to see you've got skin in the game and a real plan.

I’d also want to see the operator has meaningful skin in the deal beyond closing fees since that’s one of the closest things to investor alignment, and understand how the downside is protected.

For long term Tenants, you want stability; you want some skin in the game, moving in furniture, appliances, knick knacks, and recreational gear.If you furnish, you are creating a new maintenance headache, and an additional list of items that you need to track.

Real skin in the game is how deeply the sponsor's livelihood depends on their reputation. 

That's real skin in the game before they make a dollar.They clean the property to hotel standards at every turnover because their reviews depend on it.