Q: What is the worst that can happen when flipping a house with 100% private money financing??
If I am using someone else's money and a house that I flip sells for less then previously estimated am I out anything more then my time? Or can the private money lender sue me and make me cover the loss?
What if I am using an LLC?
I am mostly worried that the private lender could come after me and maybe even take my house ( I mean my personal residence.
A: If you find a private lender who would not require your personal guarantee and, often, security of your home co-signed by your spouse, you should hold that lender very close… or share his name with me. You will be completely liable on your project unless the lender is an idiot, and most hard money is unavailable unless there is enough equity in the deal to cover the lender.
1 user found this answer helpful
A: It really depends on the details of the contract you signed, but often personal guarantees are required. Hopefully, things go smoothly with the project, but if you end up needing an attorney, I'm sure anyone who responds would be happy to help. Good luck.
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