Where Do Property Investors Get Money to Flip Properties?

by | Oct 2, 2018 | HMO |

Where Do Property Investors Get Money to Flip Properties?
You can get the money, not through banks or rich relatives but from:
  • Mentors/Partners
  • Private Lenders
  • Bridge Lenders

We are more of a partner/ private lender. We have developed a relationship with several experienced property investors for the deals and agreed to split profit 50/50. We have completed on close to 50 projects since 2014. Basically since the property investors have numerous properties under their belts with years of experience they handled marketing/analysing/closing/rehabbing/wholesaling/etc, but we put up the money to do the deals and pay for the rehabs. We started in 1994 so we input not just money but knowledge….such as the ideas we are do with Social HMOs that are long leases….no voids…no maintenance and best of all no management. This has been great for all sides and even the society.

We only agree to fund/JV because the investors have found/purchased it at such a deep discount. One such example is a Professional HMO in Doncaster. It was in a terrible state. In 2010 it sold for 110k…we picked it up slightly below 80k. Our JV partner sent a whatsup with a similar property on the same street yesterday…similar condition for 110k once again. That is a 30k difference….We have another Professional HMO coming up with him in which we are in the 80k range.
The next level is private lenders. Private lenders that would fund are at around 1% interest per month and not a million hoops to jump through. Time is of the essence and as fast as the solicitors work we work…same for surveyors…We used to own a bridging company and now are somewhat of a private lender/JV partner to investors we work with. Depending on the structure we want to see money in the deal….yet we cover the purchase and repair costs so that they don’t have to put all own money into the deals. One of the builders who works with us who does such a wonderful job bought a building and converted it into offices and flats above. The banks then bridgers were in super slow motion and he asked if we could help him. As we had an existing relationship and his works were superior we did a deal and helped it out. It is mutually beneficial.
We look for experienced honest property investors and builders to work with. Communication….good standards …honesty build long term relationships…