The life and times of an Arizona Investor

This will be my personal journal to document my failures and successes during my real estate experiences in Arizona. All stories, thoughts, and successes will be documented..

Tuesday, March 29, 2005

Private Money is the way to go!

I wanted to show you the power of using private money. Private money is not really hard to get and everyone should have it as another tool under their REI toolbelt.

Below is a fix and flip deal that I will pull the trigger on if the property is still available. I'll be getting a loan at 70% After Repair Value (ARV).

Advantages:


Disadvantages:

The Return on Investment (ROI) goes through the roof using private money since you initial costs are reduced. This also allows you to use your resources for holding and fixup costs.

Private money can be used for not only flips, but for buy and hold as well. After you fix the place up, you could refi and pay off the private money loan. You should be able to easily refi at 80 or less and depending on your market, it may make financial sense for a rental. This is an option that I am going to pursue.

Good investing!



Posted by Hello
|| Bginvestor, 6:43 AM

3 Comments:

I agree, wholeheartedly. If you know of any willing to do work in central Texas, please let me know! I'm having a difficult time finding them here (but then my networking skills have suffered lately). :-)
Blogger Steve, at 12:31 PM  
This is exactly what I've been considering doing recently. What kind of interest are you paying on private loans? I have a lead on private investment loans local to my area, but the rates are around 12%. It might be worth it just while I rehab the properties--I'm not sure yet. I suppose it depends on the costs of the loan.

Thanks,

Trisha
http://trishasblogsite.blogspot.com
Blogger Trisha#1, at 12:55 PM  
Duh--I just read your next post and saw that you're looking for 9%-12%. :-)
Blogger Trisha#1, at 1:05 PM  

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