Insights, guides, and strategies for real estate investors
An interest reserve is the line item in your construction budget that pays your monthly interest during the build. Here is how lenders calculate it, what it adds to your loan, and what happens when it runs out before the certificate of occupancy arrives.
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A term sheet is not a commitment to lend. The fees listed on it are real money leaving your account before any draw is made. This post walks every line: origination points, processing fees, third-party costs, extension fees, prepayment penalties, and what is negotiable before you sign.
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A term sheet comes after a lender has evaluated four things: the property, your track record, your exit plan, and your liquidity. Most applications stall because one of those four is unclear. This post walks through what that evaluation actually looks like, and where files get declined.
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Business-purpose lenders prefer LLC borrowers. Consumer lenders cannot make the loan at all. Here is what lenders need from your entity, why the personal guarantee still puts you on the hook, and what happens if you transfer title after close.
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Rental property loans carry a rate premium over primary residence mortgages. The gap runs 0.50 to 1.75 percentage points depending on loan type. Here is why the spread exists and what moves it.
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A cash-out refinance on an investment property comes with a 70-75% LTV cap, a rate 0.5-1.25 points above primary residence, and seasoning rules that can halve your borrowing capacity in the first 12 months. Here is what the numbers actually look like.
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A fix and flip draw schedule is a reimbursement system. You pay your contractors, pass an inspection, and then the wire arrives. That gap between payment out and reimbursement in is what runs first-time flippers short by month two.
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ARV is the number your lender's appraiser produces, not the number you estimated. The two frequently disagree by $20,000 or more on a mid-range flip, and the difference comes out of your loan proceeds. Here is how the appraiser builds the number.
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A fix and flip loan is approved on the deal, not your W-2. Here is what a lender needs from a first-time flipper: the document pack, the deal math, and the failure modes to avoid.
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