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What lenders are available for lower priced homes that need repairs. I am

Having problems finding lenders for 50-70k.

[Wyatt Ferm]

@Tamarra West great question Tamarra! Backflip’s purchase price minimum is 50k if you have over 3 flips of experience in the last 3 years! That said, unfortunately there aren’t many lenders who fund deals at 50k-70k. Reason being – it requires the same amount of resources for a lender to process and underwrite a 50k deal as it doe for a 500k deal, so the deals just don’t have any ROI.

[Kyle]

Is income outside of the purchasing investment property required for receiving the financing on a new investment property?

[Wyatt Ferm]

@PropertiesInterested like most hard money lenders, Backflip doesn’t require proof on income. When using a hard money lender to do a deal, you usually only need to provide proof of liquidity. Every deal will have a liquidity requirement – if you can show you have what’s required, then you’ll be set!

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desperate buyer needs 80% financing – but liens, lawsuit & NYC DOB “UB” on cooperative

[Wyatt Ferm]

@mcre484aol-com most hard money lenders will provide 80% or higher. Backflip goes all the way up to 90% LTV. That said, if there are liens and lawsuits, there isn’t much that can be done until title gets cleared. All lenders require a clean title.

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Are there alternate avenues for refinancing my loan on my investment property? I purchased the home a few years ago when interest rates were 7.125%. My lender mentioned that it wouldn’t be worth refinancing until rates dropped to somewhere in the 5% range. They also noted that due to it being an investment property versus a primary property, it is harder to get my loan refinanced. Does this sound accurate? Are there any other options available to me that I may be unaware of?

Thank you for your time!

[Wyatt Ferm]

@catnic7784gmail-com great questions Catherine! Not knowing the specific details, it’s hard to say at what rate it would make sense to refi. That said, it is not difficult to refi an investment property at all – especially if you already have renters.

Many DSCR (debt service coverage ratio) lenders require a seasoning period, but if you’ve had renters in the property for over 6 months, you’ll have no issue with getting a refi.

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We are looking to expand to another mobile home park or other like business. Is there a formula or similar to decide how much to leverage for borrowing money? Thanks

[Wyatt Ferm]

@thehomesteadyantisgmail-com Hi Bryan! Unfortunately I don’t have a great answer for you. The tricky thing with how much leverage to take on is that every person is comfortable with different amounts of risk. Unfortunately there is no silver bullet formula for how much leverage one should take on, but it’s always good to make sure you never stretch so thin that you can’t weather a storm.

[Harrison Stevens]

How long do you target for most investments? How long of a hold do you think makes sense if you are going to flip? What about a buy, hold, rent, then sell?

[Wyatt Ferm]

@harrison investors that I work with utilize two different strategies. If you are planning to flip it, then the goal is to get in and out of the deal as quickly. Backflip’s loans require monthly interest only payments until the loan is repaid, so the sooner you can exit the flip, the less interest you’ll pay.

The second strategy is commonly referred to as the BRRRR method, which stands for buy, rehab, rent, refinance, repeat. Investors who use this strategy will rent and hold their properties long term. After that, how long you hold them is entirely up to you and the market!!

[Ava Johns]

For first time buyers – when should you be consulting a lender if you’re looking to purchase in in the winter of 2025? How long does this process typically take?

[Wyatt Ferm]

@ava Great question Ava! It’s never too early to start talking to lenders. My advise would be to speak to a few lenders and work with someone you like and trust. Loan officers are there to help you through the process and provide helpful education. Purchasing a primary residence is a different process than purchasing investment properties. Once you start getting ready to put in offers, then you can go through the steps to get pre-approved by your lender of choice!

[Kevin Flowers]

How much do I need to put down, and how will that affect my monthly payment and interest rate?

[Wyatt Ferm]

@kevinflowers how much you put down is entirely up to you and what your lender offers. The general rule of thumb is higher leverage equals higher costs of financing. Backflip has multiple capital products that range from 18% down to 8% down, and interest rates range from 9% – 12%.

[Kevin Flowers]

Are there any penalties or restrictions I should know about—like prepayment penalties or limits on how soon I can refinance?

[Wyatt Ferm]

@kevinflowers no pre payment penalties and no limit on how soon you can refi! One thing to note on the refi front – most DSCR lenders require a seasoning period before being able to refi, which means you may need to get renters into the property for a few months before you can refi out! The exact requirements depend on which lender you use!

[Kevin Flowers]

What are all the upfront and ongoing costs I should expect with this loan?

(Think closing costs, points, private mortgage insurance, etc.)

[Wyatt Ferm]

@kevinflowers there are 3 upfront costs that are rolled into total cash to close:

1) The origination fee which will be between 1.5% and 2%

2) Underwriting and legal fees which will be $1750

3) Appraisal fee which is $650

[Beau Thoutt]

How can I structure my mortgage to protect myself if rates drop significantly after I buy?

Are temporary buydowns (like 2-1 buydowns) a smart strategy in today’s market?

[Lexi L]

How do closing costs and fees work, and can they be rolled into the loan?

[Wyatt Ferm]

@socialbutterfly great question! It depends on what type of loan you decide to use. At Backflip, we have capital products where closing costs and fees are paid at close, and we also have capital product where they are rolled into the loan and you pay them at the end when you sell or refi!

[Shantel LaFond]

Currently own 1 residential 2-family home and looking to enter the commercial property market. Where should I start for financing and renovating first commercial property in NYC (4 units or more in outdated building) while keeping upfront costs down (DP, closing costs)?

[Wyatt Ferm]

@shantel-lafondgmail-com Hi Shantel! Unfortunately I don’t have a good answer for you. Backflip only funds up to 4 unit multifamily properties.

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Looking for alternative financing for commercial real estate. We own several properties, some fully paid but tired of local banks. Any input or advice is greatly appreciated. – Charlie

[Wyatt Ferm]

@infodeltabuildersco-com Hey Charlie – Backflip only goes up to 4 unit multifamily. If you’re looking for commercial financing, you could try Renovo! I’ve never used them but I know they finance commercial properties.

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My partner and I have a mortgage payment of $4100 (including taxes and insurance) but our home probably couldn’t rent for more than $3600 per month (and that’s on the high end of local comps). We currently live in the home.

We would like to find a way to turn it into a rental while not losing money. We are open to long term, short term, midterm, or any other solutions that would turn this home into a profitable or at least break-even property.

[Wyatt Ferm]

@rach-eric-barlevavgmail-com Hey Rachael! The unfortunate reality is that in the current interest rate environment, it’s much more difficult to have long term rents cover the mortgage. The only way to get your mortgage fully covered would be to explore short term or mid term rental strategies. That said, each rental strategy comes with pros and cons.