Will the nightmare never end? Now I’m hearing that hard money lenders base decisions on your credit score just like everybody else. What’s going on here? If I had good credit I’d go to a mortgage broker!! I wouldn’t need a HM lender or his 15% rate.
Seriously… can someone with a low paying job and less than $500 in the bank really do this real estate thing or not? I’m just really afraid I’m wasting my time and that everywhere I turn trying to put a deal together somebody is going to put their hand out. Down payments… earnest money… closing costs… where are people coming up with this money? Savings and credit cards (which I also don’t have)?
As near as I can tell, doing a sub-2 and then back-to-backing with a retail buyer seems to be the only way and even then I have to be careful that the closing costs don’t trip me up and kill the deal.
I still can’t shake the image of an escrow agent, hand out, wanting me to fork over $2K in closing costs up front so he can then hand me my $20K. Ridiculous.
I just got a reply from a lender who advertises on this site telling me there would be $25,000 closing costs on a rehab loan. Stick with local banks - they are in business to loan money. If you can’t get money from a traditional lender, you are going to get hosed if you get anything at all. If your credit is no good and you are broke, the best you can hope for is either a government program or seller financing.
Look for my new book at a retailer near you: “How I made $100 in Real Estate”
“As near as I can tell, doing a sub-2 and then back-to-backing with a retail buyer seems to be the only way and even then I have to be careful that the closing costs don’t trip me up and kill the deal.”
If closing costs will kill a deal, it is not a deal. You need to study more and find real deals.