information at the community level, but you need to know about the block your property sits on—in other words, a level of granularity that only local expertise and experience can provide. Lend- ers with a local presence know these neighborhoods inside and out, and they can help guide you toward a successful property and project. PICKING AWINNER For fix-and-flip projects, your profitability depends on buying right, renovating smart and selling fast, all while keeping delays and obstacles to a minimum. Partnering with a lender who can help you do all these things is critical to your success. Look for a lend- er who takes the time to understand you, your project and your neighbor- hood and has the lending and building industry experience to help you through
the inevitable issues that will arise. As is often the case, you may find yourself trying to choose between two lenders. The first is a lender with no construction experience who ran your project through an algorithm and is willing to advance 70 percent of the projected after-repair value of the property. The second lender, with a suc- cessful history of building and develop- ment, knows the right questions to ask about your specific project and provides valuable input to advance your proj- ect profitably. The second lender also offers several renovation suggestions, verifies your construction budget based on experience with the same type of renovation in the same neighborhood, and offers insight into the timing of the various construction phases and the ve- locity of trading in the area. You quickly realize the second lender’s knowledge and experience are invaluable, and the
decision, in your mind, is an easy one. So, when evaluating hard-money lenders, ask them about their own building and flipping experience, and give top consideration to a lender who has performed many projects in the lo- cal area. At a strategic level, your vision is to build a successful enterprise, and by selecting a lender who understands this long-term vision, you’ll be one step closer to achieving your goals. •
Robert “Bobby” Montagne is a real estate entrepreneur with three decades of experience in commercial and residential property development, finance and sales. Having successfully overseen $15 billion
in career transactions, he is among an elite class of real estate innovators that have consistently deliv- ered high-quality returns to partners and investors. A native of Fairfax, Virginia, Montagne earned a bachelor of science degree in economics with honors from George Mason University and a master of busi- ness administration from Virginia Tech.
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