For many years I have been working with investors and setting them up with hard money to get their projects done. When I speak with them, I ask what their goals are when the project is done. Some have an exit plan and others had not put thought into how to get out of hard money. Hard money is a great tool, but an expensive tool if you do not use it correctly. 

There are really 2 main exit plans to hard money - refinance or sell. This seems simple, but in the mortgage world today, things have gotten a little tougher. 

If you are going to refinance, you should talk to a loan officer who can review your credit and income and pre-qualify you for the refinance before you get in to the hard money (by the way, we also can help with that. I had to plug my company). This will make sure you can transition smoothly from one loan to another without extra costs.

If you are going to sell your property. Marketing the property from day 1 to generate interest is very important. While you are rehabbing your project, you can start to qualify your potential buyers. If someone wants to make an offer, have them show you their pre-approval from their loan officer (make sure it is a current pre-apprvoal). You may even want to meet with them and their loan officer together to make sure everything the buy needs to have handled is done. You do not want to get to the end of the project and the buyer tells you they got denied since they could not provide the needed documentation. An EMD is always a good way to making sure the buyer is serious. Keep a data base of others who contact you in regards to your project, they could be future clients.

I know this seems simple and really common sense, but it may help someone when they are thinking of getting a hard money loan (yet another plug, if you are thinking about it, we can help you).

I wish you all the best in real estate investing.

Thank you,
Scott Walter
Eastern Michigan Investments, Inc.
www.easternmichiganinvestments.com
248.453.5336 - Office