Some real estate developers may feel that without the funding to finish it, they will launch a rehab project because money will eventually arise somehow. That’s the wrong approach. Without enough funds to complete the construction, it is perilous to begin a project and see it through to completion without having the funds in place.
If you start at the beginning with very little debt on a project, you may be pressured to seek several lenders once the money is gone. You can quickly find yourself in a financial predicament. Consider starting with a loan for more than you need. A first loan is a lot easier to acquire than a second loan. When there is already a second loan in place, certain hard money lenders may not be so willing to lend.
For a certain property or scheme that has run out of money, there may be a negative stigma attached that could make something like a rehab project appear in a negative light and, therefore, reduce its sale prospects once it goes on the market. Whatever the cause, this will discourage lenders of private money from wanting to provide financing, and again, there may be fewer sellers knocking on the door once the project is ready to go.
This update is by hard money loans Miami company Monroe Funding Corporation, a direct equity lender serving clients throughout Central and South Florida. We specialize in first mortgages on non-owner-occupied residential and commercial property investments as well as real estate loan options. Our fast and flexible loan programs get you to the closing table quickly and professionally. For more information on Florida hard money lending, please call 954-419-3536 or fill out our application.