Hey investor friend, Cameron Dunlap here.
So, I’m sitting quietly in my office thinking about a few real estate deals I’m working on and was going through the different funding sources that are available to me for them, when I thought I’d write up a quick email and share it with you. (I’m a nice guy!)
I just got a land deal accepted and all the due diligence taken care of, including some environmental issues. This one is ready to fund and close, and I’m excited about it because it’s a really good deal.
I’ve also got a few residential deals that are about to close and require funding.
The funding sources that are available in today’s 2025 market, as I see it are:
- Your own cash (and not many have the wherewithal)
- Banks (a great place to go if you want to be tortured and probed prior to them telling you they’re not lending, especially if you “need” the money)
- Transactional funding (the industry-topping funding we do in here)
- Hard money (and your credit better be perfect, and you’ll need to have 10%–20% to put in the deal, then… you’ll learn why they call them “hard” money lenders)
- Taking over the seller’s mortgage (when there’s equity and they’ll let you do it)
- Private lenders (folks looking for a better return on their money in a safe environment)
- A few interesting not widely known options
Which type you’ll use will depend a lot on the nature of the deal…
Real Estate Funding Options for 2025
Your Cash
You should only use that when you are planning to resell or refi right away. You don’t want to tie up your liquidity long term. I hope this is obvious. This only applies if you HAVE cash in hand of course.
Banks
You should only go to the bank if you’re prepared to receive a financial-oscopy and, if you’re self-employed, to be treated like a criminal who is guilty until proven innocent. Then, if you can actually get them to lend you money, you’d use it on deals you plan to hold long term. To use banks for flip deals is torture on you and bothersome to them.
Transactional Funding
So, you might know that I have a funding program on STEROIDS, and the cost is DIRT cheap. If you’re not aware of the hundreds and hundreds of times I’ve helped my clients create BIG paydays by funding their deals, you should acquaint yourself with it. You don’t need any money or credit to qualify, and the market is ripe for it.
Anyone who’s a member of the Family Bank Funding or Vacant House Bank programs already knows that just for the cost of the training program itself, you can use my transactional funding to fund your next deal up to $600,000 any time in the next 6 months.
This type of funding is only for flip deals where you’re buying and reselling immediately, without doing repairs, and selling to a cash paying investor, rehabber or landlord. Wholesaling, as it’s commonly referred to.
Hard Money
You should only use this when you’re rehabbing. It’s very expensive, requires (in today’s market) you to have decent, if not great, credit… and (in almost all cases) you have to put quite a bit of your own money in the deal.
So, if you’re lacking credit or cash, this really isn’t an option — again, in today’s market. There was a time when your credit didn’t matter, and you could go in with no money of your own. Those days are long gone.
Taking Over a Seller’s Mortgage
Also known as “subject to.” This works when you want to either hold the property or flip it to an end-user buyer. This only works when the seller has equity they’re wiling to walk away from, and when they’re comfortable with you taking over (NOT assuming) their mortgage.
Private Lenders
Ahhh private lenders. I love private lenders. I’m sitting in an office building right now funded by a private lender. I have rental houses in Florida that were funded by privates lenders. I’ve done rehabs funded by private lenders, and back when I didn’t have the cash myself, I also used private lenders for short-term wholesale flip deals.
I’ve used private lenders for just about every type of deal there is — both residential and commercial. They’re versatile, negotiable, reasonable, usually don’t care about your credit, and if the deal is right, will fund 100% — or in some cases more than 100% of the purchase price.
They’re awesome, and I love them. In fact, if it weren’t for private lenders, I know I would not be where I am today.
The trick is finding them.
I can’t count how many times, over the years I’ve been asked, “Hey… who are your private lenders? Can you give me their contact info?”
I’ve always kind of laughed at that question because it seems funny to me that someone would even ask. It’s kind of like someone asking if they could use your toothbrush. YUK!
But seriously, private lenders are private individuals, yes, but… they’re also PRIVATE! Mine are mine, yours will be yours…. go get your own!
The hard part is… who do you ask, what do you say, what terms are they looking for? In the past, I winged it, and really let the deal in hand do the “talking” for me. When it’s a good deal, believe me, it speaks loudly.
Borrow it from Yourself
Yep, you can tap into financial assets you may already have within reach:
- 401K
- Unsecured credit
- Self-directed IRA
- Equity/HELOC
- Credit cards
What does that cost you?
Well, the opportunity cost of leveraging that money elsewhere.
Almost a wrap…
Ok, I’ve been at this business for nearly 30 years, and I’ve done and seen (just about) it all. So that makes it easy for me to fund my deals.
But this isn’t about me. It’s about YOU!
And I hope I’ve helped with this little crash course on various ways to fund your deals in today’s market.
The most important thing is that you’re moving the ball forward and doing deals… and not letting a lack of funding hold you back because as I’ve clearly pointed out, there are many ways.
It’s better to do something imperfectly than nothing perfectly.
Have at it.