Hard Money Lenders And The Recently Self-Employed
Hello all,
I recently formed my own corporation to persue REI. Has anyone had any experience dealing with HML and being self employed. I have great credit, but a lot of debt (Just bought 2 houses) and obviously no proven income as of yet. Will HML still work with me? Thanks in advance!
Brad
Brad, Most HML's do not care if you are employed,since they will only loan 50-65% of LTV after repairs. Their interest is in the equity of the property.
The HML looks primarily at the property value. If you have great credit it will cetainly be a plus.
Be aware however that there are some upfront costs in every deal that you have to pay at closing.
That includes any points the HML charges.
You are are also expected to make monthly interest payments, so be sure to work these in your cash-outflow numbers.
Happy investing.
[addsig]
Brad, the HML dont care about debt usually, just the value of the property.
I have a better idea for you. Run an ad in your local papers:
Real-estate investor with proven track record looking for investors who want to make 12% return secured by a First Trust
Deed.
Pre-screen the callers and find that millionaire who wants to work with you.
Take him or her to lunch. Offer to pay a point or two and 12% for 100% financing on your deals. Once you realize the power of private money, you will be set.
Best Riches,
Jeffrey Adam
[addsig]
If you're not an investor with a proven track record, is it likely you can convince a private lender to give you money? I wouldn't want to loan money to someone inexperienced, but you have to start somewhere.
I hate to say it but I think you need somebody like Adam who has a lot of experience dealing with private hard money investors.
Let him set you up with the financing you need, but be aware they want a good equity position. I mean they figure down around 60%. If your deal is in that area you can borrow enough to do the entire deal.
Cheers Lucius
From my understanding Hard Money Lenders will give you the money based on the value of the property, not on your credit score. You pay a price for this in the form of points and interest (maybe pre-payment penalty in some cases).
Ryan J. Schnabel
Depending on the HML, some are starting to want to know the FICO scores. I know this to be true for the Chicagoland area. Not all of them, but quite a few have resorted to wanting to know scores prior to approving loans. I guess that goes to say that the investing market is constantly changing.
Many hard money lenders have changed their guidelines in jan 2004, From the e-mail I've received about 75% are asking for a credit score of 580, and a recent p&l statement. I am only getting emails from companies in eleven states. So I can't say about the rest. But there also are a number of rehab loans that became available at conventional rates so when one door closes another opens
Lori
[addsig]
I ma getting at list 80% LTV. Wonder why? I guess: It must be the love my investor have for what else then for 100% certainly made money.