If you are wanting to get started in the real estate “fix and flip” or if you are currently looking for a Southern Indiana Hard Money lender – we may be able to help. HGTV has made the house flipping real estate business look easy, but in Southern Indiana it can be difficult finding financing for rental properties, or those fixer uppers that have so much profit potential. Many of the large and local banks don’t want to get back into the real estate rehab business after the housing crisis from a decade ago. This can make it very difficult to get off the ground with a house rehab business.
This is where Hard Money Lending comes in. Typically, a Hard Money Lender is fairly easy to find in larger cities. For example, there are several HML’s in the Louisville area. But, once you get north of the river it can be a little more difficult to find a lender that can help.
If you are looking for a Southern Indiana Hard Money Lender be sure to email me at [email protected] and I will see if I can help. We have a couple of different private lenders in the area that are looking to finance real estate deals that make sense.
These funds can be used for rehab loans, commercial properties, purchase, upgrades, rental properties, and refinance options.
If you are unfamiliar with Hard Money Lending you will want to understand that it has it’s pro’s and con’s. Here are some pro’s of borrowing money with an Hard Money Lenders:
1.) Credit usually doesn’t matter
2.) Income is important, but not quite as important as a conventional loan
3.) The loan is mostly based on the value of the property. If you have a home that will be worth $250,000 when your repairs are done but you are only wanting to borrow $150,000 to buy and fix up the home then this is probably a deal that a Hard Money Lender will consider. Most like to have an After Repair Value of less than 70% or so of the loan amount.
4.) It can happen quickly. Hard Money Loans can close quickly once the appraisal and title work are completed.
Here are some Con’s of taking out a Hard Money Loan:
1.) Hard Money Loans Are Expensive. Keep in mind, the lender is taking all of the risk… if your credit isn’t great, and your income is limited the only security they have is the property.
2.) Hard Money Fee’s: Expect to pay approximately 4 -8 points for the loan depending on the loan type and terms.
3.) Interest Rate on Hard Money Loans: Expect to pay a higher interest rate depending on the type of deal that you are wanting to fund.
4.) Short Term: These loans are for quick flips/rehab, less than 12 months in most cases
5.) Our Hard Money lenders currently only lend on investment properties, rehab properties, and commercial properties. If you don’t have equity, or future equity they won’t consider.
6.) Prepayment Penalty: In some situations, there may be a prepayment penalty involved
Here is an example of a recent Hard Money Loan that we funded. This loan was for a borrower that owned a vacant home and it had been empty for nearly 10 years. There was a lot of work to do on the home including new HVAC, Cabinets, Flooring, Painting, Windows, Doors, and a new electric box. The borrower had inherited the home from a family member and it had some decent equity in it but Unfortunately, he didn’t have the assets/funds to do the work that was required to fix up the house to be able to sell it for at market value.
This is where we came in, we had an appraisal done on the home and found that it was worth approximately $100,000+. The borrower needed $65,000 to pay off a lien on the property and to use the rest of the money for the work.
If you are interested in more information on our Southern Indiana Hard Money Lender program, you can email me at [email protected] or you can text me at the number below.
Be sure to let me know what type of project you are working on, and I will let you know if it is something our investors may be interested in.
(Please note we also lend on properties in Kentucky as well.)
In addition to this, we are looking to build relationships with investors that are hoping to make real estate investing a long term business.
I am looking forward to speaking with you.
Nathan Soliday, NMLS #166402
Success Mortgage Partners, NMLS #130562
190 W Becks Mill Road, Suite K
Salem, IN 47167