@@seanlovesrealestate How does the 10% interest rate differ from the 5.75% interest rate. You mentioned you pay 10% of the loan amount on a yearly basis. At 235,000 that would be 23,500 yearly and $1,950 monthly which is separate to the $1330 mortgage. With a PITIA of $1,789 and $1,950 monthly interest payments this would never workout even with $3,000 rent. Not understanding the 10% yearly interest and how that gets factored into the cash flow analysis??
@@romoismael49 The 10% interest rate loan is for a short term hard money loan. They usually last 12 months and are normally used for fix/flip projects. The 5% interest rate is for a 30 year fixed rate loan. These are for rental properties.
@@seanlovesrealestate so you presented two separate scenarios? Understood. Sorry that wasn’t clear. If that’s the case this is definitely a great financing option if the property qualifies and debt could be covered. Awesome job 👏👏👏
Hey Brian, those expenses will affect your NOI and total return but don't affect your DSCR to qualify for this program. It basically means it's easier to qualify for this loan program vs other commercial loans.
This breakdown is the best I’ve seen so far! My partners and I were considering just flipping our first investment, but now we’re considering BRRRR. Besides finding similar comps, is there anything we can do to ensure that refinancing (at a favorable rate) is possible? I watched a video where a home was appraised for less, which basically ruined the deal for him (he kept it but didn’t refinance). Just want to understand all angles and know exactly what i should be looking for as I do research. Thank you!
How does the 10% interest rate differ from the 5.75% interest rate. You mentioned you pay 10% of the loan amount on a yearly basis. At 235,000 that would be 23,500 yearly and $1,950 monthly which is separate to the $1330 mortgage. With a PITIA of $1,789 and $1,950 monthly interest payments this would never workout even with $3,000 rent. Not understanding the 10% yearly interest and how that gets factored into the cash flow analysis
The chart that you use to figure out the interest, Is that some thing all Hard money companies use? So if I’m trying to figure out what my cost would be is it safe to say I can use that chart?
Most companies have some form of internal matrix that determines the rates. Rates have skyrocketed over the past few months so this chart is no longer valid.
When you adjust the rent to $2100/mo and the DSCR goes over 1.15, is that because of the bonus (-0.125) still being applied ? If we check the status of the bonus without the 0.125 subtracted from the rate, and the DDCR is below 1.15, what would the result be ? Thanks Sean !
Great information. I’m currently looking to start remote investing here in South Texas. I plan to do multiple deals sooner than later, and say I do have the cash on hand to fund a deal completely without loan, what would be the advantage of using hard money instead?
@@seanlovesrealestate Definitely agree. I just bought your course. Didn’t realize you had one till I clicked around your channel. Appreciate you guys. Liked and subscribed!
I’m just a bit confuse , If I get a bridge loan with a hard money lender so they will provide part of the purchase price and they cover the renovations. If I want to keep the property and rent it out how do the hard money loan people get their money back?
Yes, self-employed people can qualify. We don't base these loans off of tax returns or income statements. Instead, they're based on the income that the property generates itself!
The DSCR loan is only for properties that are rent ready. If you need rehab, then you should close on the property with a regular hard money loan and then refinance once you're done
@@seanlovesrealestate that u know of, is there any company that does the equivalent of a 203k loan but for investment property not owner occupied conforming loans backed by Fannie n Freddie? Basically a loan that allows u to buy uninhabitable prop that usually req hardmoney but instead it's 30 yr fixed rate loan. 203k is the same except that the prop can need work but still gotta be habitable upon purchase. This type of product allows one to avoid having to pay closing fees for two loans(hard money then refi out)
Good stuff! I was just wanting to ask you what would the rates be for a conventional 30 year loan with hard money for credit score of above 800? 10 to 12 percent?
You can start the conversation before you have it under contract so you can confirm that you'll get the loan in the first place. Feel free to schedule a call with me if you have questions about hard money loans.
What if you buy a property, let's say a two family, already leased and paying tenants and you don't need to renovate it in any way. Does this affect the process negatively?
Hello Sean, I follow both Sharon and your channel diligently. I am interested in starting my journey by flipping homes. Questions: a. Do hard money lenders help a newbie like us? If Yes, could you refer us? b. I do not have any money to start with, I have the knowledge. Suppose: Cost of home = $100k, will hard money lenders give me the total amount? If No, then what do you suggest for the difference amount ?
1) Yes we do! Feel free to schedule a call with me about hard money loans (link in description) 2) No, hard money lenders want you to have skin in the game. They probably want around 20% down for new investors.
Got a question Whats the best possible hard money deal i could get for 1.5 million Points/ rate the p and L is trash need hard money, but its cheap because the management is a joke.
This video is GOLD!
Thank you!
Love this! Thank you so much Sean!
You're so welcome!
Very cool to see exactly how the numbers work. Thank you for this great video!
Glad you liked it!
Besides the actual content, I learned a lot about excel!
Learning the different formulas is a game changer :)
Hope to get our BRRR soon 🤞🏻 Great video!
Awesome! Where are you looking to buy?
I am located in Sacramento California. Do you offer 30 years loans out here? Also what is the down payment requirement on a 30 year loan?
I’m so glad a found this video man. I’ve been looking for financing options for a couple of weeks and this sounds like what I need. Thank you
I'm glad you liked it!
@@seanlovesrealestate How does the 10% interest rate differ from the 5.75% interest rate. You mentioned you pay 10% of the loan amount on a yearly basis. At 235,000 that would be 23,500 yearly and $1,950 monthly which is separate to the $1330 mortgage. With a PITIA of $1,789 and $1,950 monthly interest payments this would never workout even with $3,000 rent. Not understanding the 10% yearly interest and how that gets factored into the cash flow analysis??
@@romoismael49 The 10% interest rate loan is for a short term hard money loan. They usually last 12 months and are normally used for fix/flip projects. The 5% interest rate is for a 30 year fixed rate loan. These are for rental properties.
@@seanlovesrealestate so you presented two separate scenarios? Understood. Sorry that wasn’t clear. If that’s the case this is definitely a great financing option if the property qualifies and debt could be covered. Awesome job 👏👏👏
What if you had to file for Bankruptcy at one point ? Could you still get a Hard Money loan?
Yes, but they usually won't lend to you if the bankruptcy is recent
Great content. I hope to do this in the Houston, TX market in 2022.
you got this!
this is gold, thank you, already scheduled a call with you!
Love the video - what about your expenses for management, maintenance and repairs from your NOI though? That would definitely affect your DSCR
Hey Brian, those expenses will affect your NOI and total return but don't affect your DSCR to qualify for this program. It basically means it's easier to qualify for this loan program vs other commercial loans.
This breakdown is the best I’ve seen so far! My partners and I were considering just flipping our first investment, but now we’re considering BRRRR.
Besides finding similar comps, is there anything we can do to ensure that refinancing (at a favorable rate) is possible? I watched a video where a home was appraised for less, which basically ruined the deal for him (he kept it but didn’t refinance). Just want to understand all angles and know exactly what i should be looking for as I do research. Thank you!
Do you have spreadsheet with formulas already in it that you can share.
How does the 10% interest rate differ from the 5.75% interest rate. You mentioned you pay 10% of the loan amount on a yearly basis. At 235,000 that would be 23,500 yearly and $1,950 monthly which is separate to the $1330 mortgage. With a PITIA of $1,789 and $1,950 monthly interest payments this would never workout even with $3,000 rent. Not understanding the 10% yearly interest and how that gets factored into the cash flow analysis
I'm confused about the same thing
Can someone explain the 100 repair/renovation part of these loans
I like this dude
The chart that you use to figure out the interest, Is that some thing all Hard money companies use? So if I’m trying to figure out what my cost would be is it safe to say I can use that chart?
Most companies have some form of internal matrix that determines the rates. Rates have skyrocketed over the past few months so this chart is no longer valid.
Hi Sean, do you lend out in different states?
At 9:23 wouldn't it be best to add approximately 10% for property management and add utilities etc.?
Normally, yes, but we don't need to account for those to quality for this loan
When you adjust the rent to $2100/mo and the DSCR goes over 1.15, is that because of the bonus (-0.125) still being applied ? If we check the status of the bonus without the 0.125 subtracted from the rate, and the DDCR is below 1.15, what would the result be ?
Thanks Sean !
Is a hard money loan possible for STR property? (Vacation rental.)
Yes, definitely!
Can I do this with business credit under and LLC or does it have to be under my name?
We look at your personal credit
Great information. I’m currently looking to start remote investing here in South Texas. I plan to do multiple deals sooner than later, and say I do have the cash on hand to fund a deal completely without loan, what would be the advantage of using hard money instead?
The main advantage is leverage. It allows you to buy more cash flowing properties with the same amount of cash vs buying them outright each time!
@@seanlovesrealestate Definitely agree. I just bought your course. Didn’t realize you had one till I clicked around your channel. Appreciate you guys. Liked and subscribed!
@@relaxed4k Awesome! Keep us updated on your progress and when you get your first property under contract!
Interested in hard money, how do I contact you?
You can contact me here www.calendly.com/seanpanrealty/call
How can i contact you for a hard money loan?
Why not use a normal loan from bank?
I’m just a bit confuse , If I get a bridge loan with a hard money lender so they will provide part of the purchase price and they cover the renovations. If I want to keep the property and rent it out how do the hard money loan people get their money back?
So with the monthly payments should you include that into in your expenses or should you have that as cash on hand?
Can you do the Brrr Strategy if the property already has tenants?
Can a self employed person qualify and if so does it still run off tax returns?
Yes, self-employed people can qualify. We don't base these loans off of tax returns or income statements. Instead, they're based on the income that the property generates itself!
Do you guys pay for the renovations if not can I get a hard money loan through another company that does then come to you to do the DSCR loan ?
The DSCR loan is only for properties that are rent ready. If you need rehab, then you should close on the property with a regular hard money loan and then refinance once you're done
@@seanlovesrealestate that u know of, is there any company that does the equivalent of a 203k loan but for investment property not owner occupied conforming loans backed by Fannie n Freddie? Basically a loan that allows u to buy uninhabitable prop that usually req hardmoney but instead it's 30 yr fixed rate loan. 203k is the same except that the prop can need work but still gotta be habitable upon purchase. This type of product allows one to avoid having to pay closing fees for two loans(hard money then refi out)
@@AdrianButler86 I don't know of any loan program that automatically converts like that. Best of luck!
Good stuff! I was just wanting to ask you what would the rates be for a conventional 30 year loan with hard money for credit score of above 800? 10 to 12 percent?
Nope, it'll be in the 4-5% range depending on your desired LTV!
@@seanlovesrealestate appreciate your quick response. love your content! I've learned a lot!
This is great information. Do I have to have a house contract before I apply for a hard money loan?
You can start the conversation before you have it under contract so you can confirm that you'll get the loan in the first place. Feel free to schedule a call with me if you have questions about hard money loans.
@@seanlovesrealestate thank you
How can we schedule call?
@@felixsanchez89 calendly.com/seanpanrealty/call
@@seanlovesrealestate before I book the call. Does the BRRRR works for a property that I planing to move in?
@@felixsanchez89 the BRRR strategy in general works if you want to move into it, but it won't work if you plan on using our loans to refinance out
You said you can’t lend on a property that needs renovations but to add value you must rehab it!? I’m confused
There are two loan programs that I mention in this video. Each one has it's own nuances.
Is your loans just in the west coast or do you work all 48
We do most States. What state are you buying in?
@@seanlovesrealestate please tell me u can do Connecticut and NJ?
What if you buy a property, let's say a two family, already leased and paying tenants and you don't need to renovate it in any way. Does this affect the process negatively?
It doesn't affect the process negatively, but it might be harder to buy the property at a discount if it's already stable.
Aren't your numbers off?
Isn't 80% of 300k a total of $240,000??
Hello Sean, I follow both Sharon and your channel diligently. I am interested in starting my journey by flipping homes.
Questions:
a. Do hard money lenders help a newbie like us? If Yes, could you refer us?
b. I do not have any money to start with, I have the knowledge.
Suppose: Cost of home = $100k, will hard money lenders give me the total amount?
If No, then what do you suggest for the difference amount ?
1) Yes we do! Feel free to schedule a call with me about hard money loans (link in description)
2) No, hard money lenders want you to have skin in the game. They probably want around 20% down for new investors.
Got a question
Whats the best possible hard money deal i could get for 1.5 million
Points/ rate the p and L is trash need hard money, but its cheap because the management is a joke.
Feel free to schedule a call with me to go over your deal www.calendly.com/seanpanrealty/call
what if the investor got trapped because they couldn't get a conventional loan?
what are the penalties?
thank you
You need to make sure you have a solid exit strategy. Otherwise you'll end up paying a lot in hard money interest.
Your name is Sean not Shawn
10% interest wont allow you to cash flow
That's why you need to refi
Get your video off my feed. #scam
What's a scam?