Memphis is a big city, but it’s also a small town. If you know who you’re looking for, and you keep your eyes open, chances are you’ll eventually run into them. And so, for many years, I used to worry very much about my first impressions because there were people I wanted to run into. I wanted to be a real estate investor and, to do that, I knew it would help to have friends. Bankers, builders, board members, and especially hard money lenders can make the difference between wanting to be a real estate investor and, well, really being one.
So why wasn’t it working? My elevator pitch was dazzling, my handshake was firm, my hair was combed, and my teeth were white. But, whenever I met someone I wanted to meet, I never seemed to make the impact I wanted to. Was I not trying hard enough?
Actually, as I found out, I was trying too hard. Believe it or not, nobody wants to listen to an elevator pitch, in an elevator, in line at Bluff City, or out with their husband at Rum Boogie’s. Chasing hard money lenders around Memphis never got me the funding I was looking for. But, here’s the thing: once I found one of the best ways to get leads on investment deals, then they were looking for me.
What Memphis Hard Money Lenders Want
I’m sure you’re a nice person, but hard money lenders in Memphis, or anywhere, aren’t really looking to make new friends. If it happens, great, but they’ve all got lives already. What they are looking for is good deals. Business is business; they’re looking for you to bring short-term investment opportunities.
Hard money lenders are willing to take on some risk and they will work with investors who don’t have the sterling silver credit history that more traditional lenders require. They’re able to do this because they secure their loans with collateral. That collateral is a distressed house with a lot of upside potential.
They can provide the funds needed to purchase a distressed house to renovate and sell. To make the most out of your funding, you need to find the right property and make smart renovations to ensure that you’ll be able to sell it in short order. That’s because, one way or another, at the end of the deal that property won’t be yours anymore—if you can’t sell it, your lender will foreclose and sell it themselves.
None of the most reputable Memphis hard money lenders I’ve talked to are eager to do that. So, they look for real estate investors who they believe have a high probability of making good on their investment. And, that’s why they love working with investors who have some of the best leads on distressed houses—like me.
The Best Memphis Hard Money Lenders
I’ve worked with several Memphis hard money lenders by now, and my peers in my network have worked with more. Knowing who you’re dealing with can be a big help in knowing how to deal, so to help you out, here is a list of a few of my favorite lenders in Memphis:
Residential Capital Partners (ResCap)
With local lending partners across Tennessee, ResCap makes a good choice for a lender in Memphis. At the same time, their multi-state footprint allows them to accept a larger variety of deals. While ResCap typically requires a credit score of at least 620 and cash reserves of at least $50,000, they are willing to work with newer investors, too.
Like ResCap, RCN has the substantial resources of a national lender and a Tennessee focus with partners in the state. RCN requires investors to be at least on their third deal, but will accept applications with credit scores as low as 600 and cash reserves of only $32,000. However, they make up for this generosity by fixing 8.99%-10.99% interest rates for a minimum term of 12 months.
Lending Home is a good resource for scrappy investors. They require four deals of experience in the last two years, but will lend to people with credit scores of 550 with $15,000 cash reserves. You may even get interest rates as low as 8%. Minimum loan amounts are $50,000, but Lending Home will go up to 100% of the purchase price so long as it’s 70-75% of the ARV.
These lenders will willingly provide access to solid capital for good deals in Memphis. But first, you need to have a good deal, not just a good haircut. Before you start calling lenders, it’s wise to find a strong pipeline of leads. That’s why they’re called leads, after all—you need them before you can start anything else.
How I Started Making Deals with Memphis Hard Money Lenders
In my early days in Memphis, I’d find a great property and approach a lender. Instead of just looking at my numbers, they’d look at me and ask “Who are you?” Apparently, my answers weren’t satisfying.
That changed when I took the plunge and became an independently owned and operated HomevestorsⓇ franchisee. I got access to a powerful, nationally-recognized marketing campaign—you’ve seen the “We Buy Ugly Houses®” billboards. Everyone has.
Now? When I call a Memphis hard money lender with a deal, I don’t get brushed off by their assistant. Instead, my preferred hard money lenders in Memphis get in touch with me. You see, as a HomeVestors® franchisee, I’m a pre-qualified borrower because they already know my deals are vetted with industry-leading tools and resources.
Opportunities for gaining access to some of the best leads and hard money lenders in Memphis are limited, so call HomeVestors today.
Each franchise office is independently owned and operated.