No Money Down Rehab Loan

No money down to purchase the investment property. No money down to rehab the investment property. Points rolled into the loan. Nationwide rehab program based on the After Rehab Value. Here are the guidelines.

THIS PROGRAM HAS BEEN DISCONTINUED

1. Up to 100% financing is available, generally at 17% interest rate, plus 9 pts., $1,500.00 origination, plus legal, title and escrow, any other closing costs. Discounts will apply for experience, credit, down payment, and other factors.  $50k minimum loan amount with No Money Down.

2. FBC Funding will generally lend in a situation where the combination of the purchase price plus the appropriate rehab does not exceed 65%(roughly 2/3) of the realistic, saleable, after repaired value of the property. This is a “rule of thumb” that makes it very easy for the borrower to assess what deals will be funded. If the after repaired value is $400,000 or more, we can consider going up to 70% LTV, still with No Money Down.

3. All borrowers are students of our affiliated education provider, Strategic Real Estate Coach, which publishes the finest real estate education available. The core program teaches how to buy, rehab, and sell properties, and earn $40K checks AT WILL, all with very little work and NONE of your own money! There are several great modules full of excellent information, plus plenty of documents, charts and videos, resources, and tons of other info. Educational students also get an instant verifiable $500K POF (Proof of Funds Letter), which can be used to help secure purchase contracts from sellers.  (This education MUST be purchased before the loan is closed, no exceptions.

4. We are a business to business lender. Our borrowers are formalized business entities (meaning the borrower’s company name is registered with the Secretary of State), either a corporation or a limited liability company (LLC).  The business must have an individual guarantor; usually the person who is submitting the loan application. Properties must be purchased in the company name or, in the case of a refinance loan, the collateral property must be owned in the company name.

5. Please avoid stating “cash” on your purchase agreement(s) because title agencies process cash purchases differently than lender purchases.  Also, if you state “cash purchase” when you have a lender, an addendum has to be submitted to the seller stating it’s a lender purchase.  Sometimes the seller refuses to accept the addendum and the deal is lost. Offers can state, if you wish, that payment will be a “privately funded loan, borrower is approved subject to appraisal review”.  This statement should assure the seller that there won’t be any delay in the closing, and receipt of funds.

6. The No Money Down loan is available in most states with the exception of CA, AZ, UT, ND, NV, HI, AL, and a few others.

7. In general, we are not “score driven.” We prefer (but do not REQUIRE) that our borrowers have a 640 or better credit score (mid score).  We use credit as an indication of character. Borrowers with credit issues, or whose history shows a catastrophic life event, such as death, disease, divorce or disaster are generally acceptable regardless of score; borrowers who habitually abuse credit are not acceptable. A guarantor can have a recent BK as long as the case is CLOSED (not just discharged.) Any felonies must be at least 7 years distant for guarantors.

8. We normally do not lend on properties located in high crime or derelict neighborhoods. We determine this based on crime statics, public school “grade” or condition, and other factors available from published statistical information. Houses located in applicable areas generally must have at least 3 bedrooms and be at least 1,000 sq. ft. We generally require that subject collateral property be in a Core Based Statistical Area (“CBSA”) of at least 100,000 people, although smaller CBSAs sometimes qualify. CBSA is  a designation applied by the US Census Bureau.

9. Borrowers who require a loan that includes rehab should be able to demonstrate that they have some money on hand to start their project – ideally 20% of the rehab budget, or a minimum of $2,500.00 – whichever is greater.  This is a flexible standard. Funds from the rehab escrow are disbursed in increments as work is completed.  As the rehab work progresses, borrowers submit draw requests for reimbursement of funds. Borrowers may act as their own general, or specific trade contractor, or both.

10. We generally close the No Money Down program within three weeks, but can close faster in some circumstances.

11. All loans require an Appraisal, by a licensed Appraiser, and a Site Visit. The Site Visit Team Member will visit the property and take comprehensive photographs and video. Cost of this in most markets is $250.00. Both Appraisal and Site Visit are ordered by the lender, and performed at Borrower’s cost.

12. There are generally no other upfront fees or costs. Borrowers make interest-only payments on the first of each month, and at the end of the term we anticipate being paid in full.  Depending on the agreed upon loan term, thirty days prior to the maturity date a borrower may submit a written request for a loan extension that, if approved, will charge the borrower 3 points.

13. There is no prepayment penalty.

The post No Money Down Fix and Flip Real Estate Funding Program appeared first on FBC Funding.

100% Fix and Flip Guidelines

Fix and Flip

Real Estate Investor Funding

100% fix and flip guidelines for real estate investors. As a Mortgage Banker Specializing in Rehab and Fix and Flip financing FBC Funding offers many programs, including many residential fix and flip programs that offer No Money Down options for the purchase and 100% of the rehab costs for repairs. We have multiple such programs. Unfortunately, 100% purchase rehab is not available in every state and the terms vary depending on the state the property is located in. Instead of publishing all of the guidelines for all of our 100% financing programs I will publish ranges. If you meet the general criteria here, please contact us for a full pre-qualification of your project.

We offer four 100% programs with a fourth option for an unsecured term loan that turns a loan requiring down payment to 100% financing. The parameters are below. Every program is not available in every state.

100% Fix and Flip Guidelines for Purchase and Rehab

• Minimum Credit Score:   Minimum 660 preferably 700+ (620 with at least 1 completed flip in the last 2 years)
• Experience: 1 projects in the last 2 years (no experience necessary for full document loan and at least 660 credit score)
• Cash Reserves: Minimum of $30,000 for loan amount up to $250,000- or 6-months of payments plus 10% of the renovation costs.
• After Rehab Value: Maximum loan will be no greater than 65% of the after rehab value (up to 75% ARV with a 700-credit score and strong experience)
• Rates: starting at 12.5%
• Points: 3% to 5%
• Term: 8 to 12 months
• States: Alabama, Colorado, Connecticut, Delaware, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Utah, Virginia, Washington, West Virginia, Washington DC*****New York Investors: Restrictions apply in Queens, Bronx, Brooklyn, Staten Island, or Manhattan.****  Limitations apply in certain other cities – call for details

100% Fix and Flip Guidelines for Purchase Rehab with no payments 

These 100% fix and flip guidelines are a financing program is for very experienced investors who have completed eight or more successful renovation projects in the last 5 years. The program is available in 40 states. Some closing costs are rolled into the loan, and the borrower has no monthly payment so the interest is due at the time the loan is paid off. The only money due at closing would be the lender processing and document fees, legal fees and title charges. The terms are as follows:

• Credit Score: 620+, The rate and points are based on the loan amount, credit score and experience.
• Minimum experience: 8 successfully completed projects in the last 5 years.
• Cash Reserve closing costs plus 10% of the renovation costs
• After Rehab Value: Maximum loan will be no greater than 75% of the ARV
• Rates: 8% to 14% depending on Credit Score, loan amount and experience
• Term: 6 months, 9 months or 12 months.
• States: This program is available in 40 states nationwide.

 CURRENTLY ON HOLD

100% Fix and Flip Guidelines for Purchase and Rehab with closing costs rolled in

• Minimum Credit Score:   Minimum 680 preferably 700+
• Experience: no experience necessary
• Cash Reserves: Minimum of 10% of loan request plus 6-months of payments
• After Rehab Value: Maximum loan will be no greater than 70% of the after rehab value (up to 75% ARV with a 720-credit score and strong experience)
• Rates: starting at 12.5%
• Points: 3% to 5%
• Term: 9 months
• Full Doc with income and asset verification.

• LIMITED JOINT VENTURE OPTIONS AVAILABLE / CALL TO DISCUSS YOUR PROJECT

FOR MORE INFO EMAIL LOUISJ@FBCFUNDING.COM

Call 888-848-3114

Click here to Schedule a free loan consultation

OR  GET A PREAPPROVAL HERE

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Hard Money. There are many types of hard money or fix and flip financing programs available today. The question many investors are asking is, what is the best option for me. This answer really depends on your circumstances because there is no one best option for every investor. That is  one major advantage of working with a hard money mortgage broker who will properly represent your interest and not just sell the program they have.  Most Real Estate Investors want to put no money down for the purchase and get 100% financing of the rehab as well. They also want the lowest interest rate and lowest points and fees. Unfortunately, you can not have both the best terms and no investment. So here are important factors to consider when determining the best  hard money loan purchase rehab program for your situation. Consider these points:

• How much money do you have for the down payment
• How much money do you have for renovation
• How much experience do you have as a fix and flip real estate investor
• Are you working on other projects now
• What is the return on this investment
• Are their additional potential projects you can do before this one is complete
• Do you meet lender guidelines

No Money Down Financing

On the surface this should be the best option always because you are not investing any money for the purchase or rehab of the property. In reality the Hard Money Lender is taking all of the risk while you earn the majority of the profit. For the increased risk the rates and fees are higher. Therefore if you have options the added costs of 100% financing may not be to your benefit. You must weigh the options. Obviously, if you do not have the funds for down payment and renovation or you are working on other projects now, the 100% financing may be your only option. You must realize the Hard Money Lender will either take an equity position or charge higher points and fees. Typical hard money terms are  about 20% to 30% down payment (or more), 10% to 12% interest rate and 3 to 4 points. You may get a lower down payment with similar terms if you have very good credit and substantial experience as a fix and flip real estate investor. In contrast for no money down option you would pay 16% to 18% interest and 8 to 10 points, plus you have a shorter term to complete the project generally 3 to 6 months. These higher rates and fees generally equate to a cheaper equity partner. Most equity partners who put up all the money get at least 50% of the profit.

How to Qualify for 100% Financing Hard Money Loan

Most Hard Money Lenders that offer the 100% financing option look at two major qualification requirements. The first is the property. What is the purchase price, the as is value, the cost of rehab and the after rehab value. If they can realize an after rehab value of no more than 60% to 70% of their total investment of the purchase price and rehab costs (some lenders even cover closing costs if the ARV LTV is good) and their profit is sufficient then the most important criteria is met. Secondly, the HML considers the experience of the investor. How many projects have they completed in the last year or two. Many require three to four recent projects before they would consider a fix and flip investor experienced.

Finally choose the no money down hard money loan if you have no choice or if you are working on other projects and just do not want to deploy your funds. There are investors who only use OPM (other peoples money) and their philosophy is to do as many deals as possible without using their own money. You can make an informed choice.

The post What is The Best Hard Money Loan appeared first on FBC Funding.

There are no money down financing options available. I am a mortgage broker who specializes in real estate financing for investors. I even offer Hard Money. I get calls nearly everyday from people who want to put no money down to purchase and rehab properties. They have been taught or they just believe it is a good idea to invest with no money and let the lender take all the risk. Yep, if you invest no money you have nothing to lose. The lender takes all the risk. Really that is what it is all about. Invest no money and get a great profit for doing so by purchasing, renovating and selling distressed properties.

WHY NOT

The lender takes all the risks.

You make all of the profit.

This sounds very good.

Unfortunately, it is not really the best option for some people. In reality no option is the best option for everyone.

Some would say if you have cash to buy and rehab the property then sell it with no financing at all that is the best option.

Really it is not. For instance, if you had $100,000 and it took all $100,000 to complete a fix and flip then sell it for $150,000 making a gross profit of $50,000 with no financing costs you did a great thing. You did.

But, a better solution is to use $30,000 for down payment and do 3 deals. If the financing costs was $10,000 per deal you would still net $40,000 per deal for a total of $120,000 profit. Which would you prefer – $50,000 profit or $120,000 profit

The same is true for 100% financing. Assume you had a lender give you 100% of the money needed say the same $100,000 and assume 18% interest and 10 points and standard closing fees (real numbers) you would pay over $20,000 and net only $30,000. Is that a good deal. Maybe, Maybe not. It depends on your options. Simply put if you have money for down payment you would make $40,000 per deal versus $30,000 per deal.

So really, all three options have their advantages and their disadvantages.

Option One: invest all cash for purchase rehab and yield the greatest profit per deal.

Option Two: invest 30% (more or less) yield less per transaction but have money to do more deals yielding a greater total profit because with the same amount of money in Option One you can do 3 similar size deals.

Option Three: invest no money  yield the least dollar amount return but the greatest rate of return. Because rate and fees are highest with no investment then your net profit is the lowest.  Because you invested nothing your return on investment is highest.

Which is the best option for you? Lets assume in a one year time period in option one your return is 150%, option two it is 133% ($90,000 invested for $120,000 profit) and unlimited return in option three because you invested nothing.

If option one or option two are not options you have due to lack of funds and you are forced to choose option three yet it is the greatest return on your investment even though it is the least return.

No Money Down

This is the least return but the greatest per cent return. So if you have no option and you just hate the thought of paying such high fees. Do one deal. Make some money to put down on the next deal so you would make more money. Or just relish in the fact the lender is taking all the risks by investing in you since your are not investing any money. Make less money but the greatest return on investment, because you have no financial investment. Some people only do deals like this and they make lots of money using other peoples money. Finally, consider the Hard Money Lender your cash partner. If you had a partner who put up all the money what per cent would you share with them.

The choice is yours. The object is to fix and flip some properties and make great money and an awesome living.

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