Financing Concerns
I'm new to real estate investing and I'm currently looking at doing my first rehab since its what I want to focus my real estate business on. My question is that I recently went through a divorce so my credit it shot and I have very very little of my own money. So I'm curious to know how I would go about getting my rehabs financed since I would be buying the properties I find at wholesale price and fixing them up and then turning around and paying off the loan once the property sells. Ive read a little bit about hard money lenders and I know some will base a loan on the LTV but I'm afraid they will check my credit report and deny my loan. Does anyone know of any lenders that will not look at an investors personal credit and just lend on the LTV alone? My goal here is to split my profits in two by using half of it to pay off bills and improve my credit and put the other half into an account so that I can finance my own deals or further my real estate investing. Since I'm now classified as self-employed but yet have not done an actual rehab yet how do I convince a HML to finance my rehabs? Would I need to put a property under contract and subject it to finding proper financing for the rehab before actually hunting down a HML?
Again Thanks in advance for all of your help.
Hunt the HML lenders down now and get to know them. This way when you do find your property you can get a hold of them and get it taken care of right away.
At the very least, find out how they lend and all of the items they need from you in order to provide you with a loan.
hello Passionbaby,
I am afraid to tell you that no investor is going to loan you money because you are a nice person. If your credit score is below 500, you will have to have a good work history and money in the bank in order to secure a loan. Put yourself the banker's situation. Would you loan money to someone like you?
You might try this approach. If you are good at fixing up homes, you might locate a home in need of repair, then work out a deal with the home owner. You can still do a work-write-up, listing all repairs and cost of each. You can present these to the owner, say, I will be willing to do all these repairs for you if we can split the profits. If you have no money to buy supplies, then maybe you can get the home owner to take out a equity line in order to begain the rehab work. After doing two or three of these deals then you may very well have the money that would be needed for you go out on your own.
It is all about selling yourself and the idea. When a person wants to make money in REI, there is no limit to things that can be done to become a successful REI. One just have to be creative.
You may first try owner fi. Low or no down and purchase agreement. Fixing and putting your money into the project, then split partial profit w/ current owner.
beaware of OO requirement in low-down programs, and OO certification than needs to be signed.
Hope you have trusses........its either a fill lot or depending on how they did the interior the builder never properly tamped the soil prior to pouring the slab.
I simply adding more weight to an already stressed floor will do nothing but make the floor sink more or until enough weight is applied to get your around a 2000 psf rate of which it may settle out then.
I personally would have done or still do a pressure grouting repair so as to stabilize the slab itself.
You may still need to skim coat the slab afterwards to level it out but based upon what you have said (without any pictures) I would approach from this avenue.
regards
Jeff
May also want to make sure there are no water issues here. Have you checked for plumbing water line or drain leaks?
* Check out Lasershield d*t net, connected to cellular network and easily movable from prop to prop
* Motion activated cameras
* Locked fencing around HVAC
* Motion detecting lighting / alarm
* Paint copper with white primer
* Padlocks to below-house access
[ Edited by d1beard on Date 10/27/2010 ]
[ Edited by d1beard on Date 10/27/2010 ][ Edited by d1beard on Date 10/27/2010 ]
I agree with the advice concerning neighbors. Neighbors are usually very happy to see us come in and improve the property and will call police if they see vandalism or theft.
Also, for $ 40.00, we buy a rebar cage and concrete it in place around the outside AC unit to slow the thieves down.
Use timers and interior lights (from Walmart or HomeDepot). They come on around 7pm and off around 10pm and in the morning hours.
If empty, we leave the blinds open to see noone lives in there that has a laptop or cellphone.
Private property sign on the window.
Motion activated lights on the outside.
Ask neighbors to call police.
Put a sign on window (ADT or similar).
Portable alarm system, whether just sound or wireless GSM based (those are around $400-$500).
And of course, property insurance with a low deductible if you can get it.
bargain76,
How do you find rebar cages for $40? I am finding prices a lot more for steel cages to cover outside units.
Thanks.
We found a guy with a surplus of rebar from construction jobs. He fabricated rebar cages for our guys to prep, paint and install.
When his rebar supply ran out, we contracted with another guy to fabricate, paint and install (in concrete) rebar A/C cages for $250.00 each.
@ John,
How do you have the AC Repair man to work on them?
Do you have any photos you can share?