Is Hard Money To Risky For First Rehab Deal?
I have been browsing TCI for over six months now and gathering info on rehabing. I am ready to try to find a suitable property. I think hard money is pretty much my only option at this time to finance the deal. I would like to know if hard money is to risky for a first deal because of my inexperience or can it be a consideration. My only other option is to wait until I have more money in pocket.
I run my own construction business that I just started this year and will do all the work myself (I have been in the business for 10 years). I think my main problem (for financing) is that my income is to questionable for any other financing.....anyone else been in this situation??? THANKS.
My partner and I just completed our first rehab deal last month and we used hard money to finance it. I am a newbie and didn't know anything about hard money prior -I was just looking for a lender that would lend on the deal. I thought I could get traditional financing, but couldn't find a lender that would touch it, because it needed repairs on the outside. The majority of the hard money lenders required at least $100k loan amount and we didn't need that much. So, I located a company that would lend on a smaller amount, but the term was for only 6 mos. I had no other financing option and was in jeopardy of loosing my deposit, so I went for it. I dealt with UMTH and they were professional from beginning to end. The draw process was simple and efficient. We finished the house in a little under two months and just refinanced on 12/30. If the numbers work, it’s definitely a way to go, because we came out of absolutely no money at closing or for rehab. We kept our costs low and were able to refi at a good rate. I don't know if this helps, but that's my story
A partner and I got started by buying as owner-occupants with 5 percent down on our first re-hab and condo conversion. It gave us good numbers and project photos to add to our portfolio along with projects I've personally done in the past. It gave us a good experience to present to lenders to start our business. A lot of people start that way to get a little cash going to cover the LTV on the next project. I don't know all of your situation, but that was my experience.
vmalone27
Whats the name of that company you use?
and do they only do business in your town?
I used UMTH -based out of TX, but they do business in several states.