Hard Money in NJ - Posted by Tom NJ

Posted by John Corey on December 24, 2005 at 08:30:42:


Thanks for clarifying.

Assume that to sell quickly (3 months or less) you need two things. A property that is priced right (at or below market - likely below) and a buyer that will not run into seasoning issues.

On the second, they have to be specific as to the lender or there has to be little change in value from when you bought it to when you sold it. I doubt the second would apply. So, you need a savvy buyer who knows why a number of lenders will want to work from the unseasoned value (if we call it that).

I know one hard money program that has no pre-payment. They charge an extra point up front and wave what would have been their normal pre-payment fee.

Though I know of a solution I have also found that selling in under 3 months at full retail is rare. Most investors who flip a property quickly for a decent profit will either discount from retail or do something else so that seasoning and the choice of lender does not scupper the deal late in the underwriting process.

I suspect there will be others with different advice so continue to shop around. Get in touch if you want hard money with no pre-pay (the extra 1 point so 6 points in total). Until I know more about the property I can not tell if the program matches. The LTV will be based on the as-is appraised value is one condition.

Traditional hard money with no credit check or verification of income.

John Corey

Hard Money in NJ - Posted by Tom NJ

Posted by Tom NJ on December 22, 2005 at 13:13:05:

Does anyone know of a hard money lender in, or that lends in, NJ that doesn’t have a pre-payment penalty? The best I have seen is three months…which isn’t bad. But, zero months would obviously be better.


Tom NJ

NO PREPAY IF NO REHAB - Posted by Ben Carmona

Posted by Ben Carmona on December 24, 2005 at 14:16:07:

Are you planning to rehab the property?

If not, and you just need 70% of the true value to get the purchase completed and intend to sell/refi immediately, there are a couple lenders out there that may be able to help you.

Ben Carmona

Re: Hard Money in NJ - Posted by John Corey

Posted by John Corey on December 22, 2005 at 21:43:29:


What is the issue with a pre-payment? Are you saying that the lender wants 3 months no matter when you pay the loan or that there is a pre-payment during the first 3 months?

Obviously you do not want to pay more than you have to. Even with the pre-pay are the other terms good or better than the competition? It is the total cost after all that really matters.

John Corey

Re: Hard Money in NJ - Posted by Chris Macone

Posted by Chris Macone on December 22, 2005 at 14:49:18:

Hello Tom, Have you considered using private money? They do not charge a prepay penalty.

Re: Hard Money in NJ - Posted by Tom NJ

Posted by Tom NJ on December 23, 2005 at 07:43:07:

I am saying that there is a 3 month pre-payment penalty during the first three months. I have only researched a handfull of lenders so far - all having a pre-payment penalty. I would prefer not to carry this property for three months.

Re: Hard Money in NJ - Posted by Tom NJ

Posted by Tom NJ on December 22, 2005 at 15:19:02:

No, I am not familiar with private money. I have been working on some deals that, if they come together, may turn around very quickly. I was beginning to factor in a pre-pay as part of the expenses, which, in turn, will leave me with less of a return or make me less competetive.