 Sat, Aug 30 2008 10:19 AM
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camillel150
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Financing for Rehab Properties
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Hi everyone,
My name is Camille and I'm new to the group. I'll be attending my first RING meeting in the Lehigh Valley on Sept. 11th and hope to meet many of you through those meetings. In the meantime, however, I have a question about financing for rehab properties.
My husband and I have flipped two homes in the Lansford/Coaldale PA areas and we just renovated a two-unit in Tamaqua, PA that we have rented out at the moment.
The two homes we flipped were extremely cheap and we used credit cards and personal funds to purchase and rehab. Since we didn't have much money we did all the work ourselves - part time - which took way too long and cut way into our profits.
We'd like to move on to another flip - and eventually work this business full-time - but our problem has been with financing. In today's market it seems almost impossible to find lenders willing to fund such deals.
My question to all of you, then, is do you have any suggestions?
Is hard money the best way to go, or is there a secret for finding private investors? Or are there other sources out there that might be helpful? We have a corporation but we've never used it and someone recently told me that we should be able to get low interest loans under the corporate name, but I haven't found anything there yet (still have a lot of research to do on that end though).
Any advice is appreciated. Thanks much.
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Tue, Sep 9 2008 10:15 AM
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robb1961
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Re: Financing for Rehab Properties
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You could try Wells Fargo Mortgage. They offer 90% financing of the purchase price and 90% financing of the rehab costs, however they are full doc (w2's, tax returns, pay stubs) and you have to use licensed/insured contractors to do the work. Their number is 302-731-1400, ask for John Adams, he will tell you the areas he covers. Rates are good (7-7.5%). Hard money and private money is more expensive. Omni National Bank offers a program at 70% of the ARV (after repaired value) for purchase & rehab. They will require less paperwork, higher rates and want you to have some money in the deal (10-20%). Ask for Greg Kroll at 484-868-3009. Tell either that Rob Beeman gave you the number, they may be able to help.
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Tue, Sep 9 2008 11:02 AM
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camillel150
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Re: Financing for Rehab Properties
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These are great leads Rob - thank you so much!
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Wed, Sep 10 2008 5:37 PM
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robb1961
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Re: Financing for Rehab Properties
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Your welcome, hope they can be helpful. Also remembered one more option: Equity Development Corporation. They are out of Virginia, however lend throughout East coast, not sure if they do Lehigh Valley area. Do not remember their web site off hand, but if you google their company name you will find it. They are similar to Omni National Bank program, but with higher rates and less need for your money in the deal. They and Omni both offer weekly draw visits for construction draws, which helps lower the carrying costs on you or the contractor(s).
Good luck, Rob.
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Wed, Sep 17 2008 12:04 AM
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joemacinvest
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Re: Financing for Rehab Properties
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