That hard money loan I almost walked away from saved my flip

I was dead set against hard money lenders after hearing horror stories, but I took one for a quick flip in Austin last fall. 15% interest and 3 points upfront, but I closed in 5 days and sold the property in 4 months for a $22k profit. Anyone else have a loan type they were sure was a scam until it worked out?

3 comments

3 Comments

claire_ramirez19d ago

I took out a 12% hard money loan for a duplex in Phoenix last year and honestly I was terrified. The interest rate seemed crazy high and the points felt like robbery. But I closed in 4 days and the deal would have fallen through with a conventional lender. I flipped it in 3 months and walked away with about $18k after everything. I mean, it's not for every project but sometimes you gotta pay for speed and flexibility.

lisaf3819d ago

Did that 12% rate keep you up at night while you were flipping it?

the_holly14d ago

My buddy took out a 13% rate on a flip in Austin last year and he slept just fine somehow lol. @claire_ramirez that 18k return on a 3 month flip is pretty solid considering hard money rates are brutal right now. The points and closing costs eat into everything but sometimes you just gotta do what you gotta do to lock in the deal. I swear half the battle is just finding a hard money lender who wont ghost you after you wire the funds.