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- Jun 24, 2014
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@Antifragile thanks again for this amazing thread and the wealth of knowledge you're sharing for free.
Say you have investors lined up, money in hand, and you have found a great redevelopment deal which will involve rezoning to permit 10 townhomes on a decent sized lot that currently houses 2 detached homes. So you'll need to assemble the lot and rezone.
The homes are owner occupied, so you can get traditional loans.
You closed on the homes and now you're carrying either a mortgage or an interest-only loan.
Assuming you're a new developer, who's covering these payments until you start the redevelopment process. This is something that has always boggled me. I find great deals, I get money lined up, then I realize I need to take care of $5000/month interest payments while also covering my own personal expenses and I slowly turn the chapter over (lol).
Is there a type of loan I'm not aware of that would not have this issue? This wouldn't be an issue with cash deals but most of what I've been offered is just acquisition of the property on terms of a bare minimum downpayment to get a loan on the property/land/etc.
Say you have investors lined up, money in hand, and you have found a great redevelopment deal which will involve rezoning to permit 10 townhomes on a decent sized lot that currently houses 2 detached homes. So you'll need to assemble the lot and rezone.
The homes are owner occupied, so you can get traditional loans.
You closed on the homes and now you're carrying either a mortgage or an interest-only loan.
Assuming you're a new developer, who's covering these payments until you start the redevelopment process. This is something that has always boggled me. I find great deals, I get money lined up, then I realize I need to take care of $5000/month interest payments while also covering my own personal expenses and I slowly turn the chapter over (lol).
Is there a type of loan I'm not aware of that would not have this issue? This wouldn't be an issue with cash deals but most of what I've been offered is just acquisition of the property on terms of a bare minimum downpayment to get a loan on the property/land/etc.
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