Posted by Larry on December 19, 2005 at 01:16:22:
7 points is not bad since it is capped at 5k. But otherwise 7pts would be 14k on a 200k house. Ouch. Only as a last resort.
HML terms - Posted by Rich (WA)
Posted by Rich (WA) on December 18, 2005 at 16:06:31:
What would be reasonable terms to pay on a HML to buy a house to rehab?
Re: HML terms - Posted by Kristine-CA
Posted by Kristine-CA on December 19, 2005 at 10:08:23:
To me it’s not about what’s reasonable–it’s about what makes sense
in the deal. I pay 3 points and 18%, but the deals I 've used the money
on had whopping profits. So what if I pay $2K to make $50K. 
It’s also about speed. The hmls where I am do their own appraisals the
same day and take the money to escrow in a day or two. One of them
lends 68% of his appraisal value–which means I can get cash back at
closing if I bought right.
I hold the properties for just a few months so the interest never really
bothers me.
Obviously if you can get the money cheaper and easier from someone
else then of course you should do that. HMLS are for all those other
times. Kristine
Re: HML terms - Posted by ken
Posted by ken on December 18, 2005 at 18:36:31:
16%, 5 points, minimum 6 months of payments,pay their attorney fee is pretty standard
Re: HML terms - Posted by John
Posted by John on December 18, 2005 at 20:30:40:
Wow that seems like a lot.
Why is that high? - Posted by js-Indianapolis
Posted by js-Indianapolis on December 18, 2005 at 22:23:36:
If you cannot get it anywhere else, and you’ve got a REAL steal deal, why not?
I pay 15.6%, 7 points (capped at 5K) but no payments for 6 months. That, and the last time I borrowed, I talked with the guy on Thursday, got an answer in 10 minutes, and a check waiting on Tuesday. I can even have his funds waiting to close a deal if my buyer backs out on a double close, and only pay a $100 cancelation fee. A nice little insurance policy when I’m trying to get the planets to align, and double close.
So is that too high? It’s convenient. And like paying $1.50 for a Coke in a hotel, convenience costs.
BTW, I have another lender who does 5% flat fee for 3 months, 10% for 6 months, simple interest. However, he only loans 80% of purchase price.