Is 100% LTV Possible
Getting to 100% LTV financing for a real estate project is not the norm and can be challenging, but there are a few options that investors can consider:
- Joint Venture: One way to get 100% funding is to partner with an investor who is willing to provide the necessary capital. In a joint venture (JV) agreement, the investor provides the funding, while the other partner brings their expertise in real estate investing, such as finding and managing the property. The profits are then split according to the terms of the JV agreement.
- Hard Money Lenders: Hard money lenders are private lenders who provide short-term loans based on the value of the property. While they typically don’t provide 100% LTV, they may be willing to provide a significant portion of the funds needed for the project, sometimes up to 90%. Hard money lenders may also be more flexible in their lending criteria, making them a good option for investors with less-than-perfect credit or who need to close quickly.
- Private Money Lenders: Private money lenders are similar to hard money lenders, but they are usually individuals rather than companies. Private lenders may be willing to provide 100% LTV if they believe the project is a good investment opportunity.
- Seller Financing: In some cases, the seller may be willing to provide financing for the project. This could include a lease-purchase agreement, where the investor rents the property with the option to buy it later, or a land contract, where the seller provides financing for the purchase of the property.
Overall, getting 100% financing for a real estate project may be challenging, but by considering options such as joint ventures, hard money lenders, private money lenders, and seller financing, investors may be able to secure the necessary funds for their project.
Don’t be afraid to combine these options either. You never know what is possible until you ask. Sellers, lenders and partners may all come together and make 100 LTV possible, but it has to be well thought out, secure and fair to all parties involved.
It’s important to do thorough research and due diligence before entering into any agreement or partnership to ensure the best possible outcome for all parties involved.