What Do You Suggest
Good day folks.
I am looking to utilize some cash in some aspect of the RE industry with some quick return in 25 days or less and fast closing.
However, I am seeking folks suggestions and opinions in what aspect it should be.
Such as tax liens, distress properties, down payment assistance, tax deeds, etc. What aspect will allow me to simply invest without the headache of holding any properties and making money on my investments?
If you have strong experiences in the aspect you wish to suggest, let me know. The reason for my search is that any funds used, I must make a balloon payment in 30 days so if I invest in RE, my exit strategy must be strong and solid.
I even heard of programs to invest in development property and get cash back up to 25% at closing, yet can seem to put my hands on those as there is only a handful that actually does them.
Your thoughts and suggestions is greatly appreciated. If you have deals you think I should consider, by all means, let me hear them and I am open to suggestions.
Regard
[addsig]
In general Real Estate is a long term game-25 days is more like an inspection period.
Possibly a bridge loan- sometimes it is beneficail to buy with cash and then refinance, as you can borrow based on appraised value rather than purchase price.
Chris
You have too look at how much risk you willing to take as well.
Bridge loans / private money lending seems like the easiest.
You might be about to provide money to people buying foreclosure. Just protect yourself on what collateral you have.
4 points and 14% is not that bad these days.
We have seen 5 points and 18% in our market....with a 680 minimum credit score.
Junk fees are a bit strong, though.
[addsig]
You may be able to do better if you keep asking. I have a private lender who has $125K available to lend me at 8%, six month maximum term, no fees, interest accrues until payoff.
This individual is a senior man who is not that happy with the rates he has been getting on 6 month Treasuries. He is willing to park short term money with me at 8% if I find an appropriate deal.
Is he open to lending to people in other states?
Itis always good to look around and talk to people in your local REIA.
HM differs around the country and even in the state. I have two guys that charge 30-36% consistantly and keep about 30 million going at that rate.
Two others charge 3 points and 12-13% and are always looking for more clients.
In everything you want to make sure that you are comparing apples to apples and that means talking to people in your market to see whether it is a good rate and terms etc. Go to REIA, ask other investors, talk to title people.
The most important thing is whether you can make money or not on the project not what you pay in fees. I use 80% of ARV (-) repair costs as my absolute basis.
Good Luck!
[addsig]
Over here in the DFW area of Texas the going wholesale rate is 65% ARV - repairs.
HM lenders are lending at 65% ARV.