Hard money lender in Fort Worth, TX.

I am a hard money lender in Fort Worth, and the city gives an investor two very different markets inside one set of limits. On the east and south sides you find small frame and brick houses from the first half of the last century, priced low enough that a full rehab still leaves room. Closer to the center you find historic blocks where the house is worth more and the rules about touching it are stricter.

What ties those markets together is the tax bill. Texas collects no state income tax, so local property taxes do most of the work of funding schools, the county and the city, and on a rental that line is often the largest cost after the loan itself. The bill the seller paid last year is rarely the bill you will pay once the house is yours and renovated, and a hold that only works on the old number does not really work.

I am a private money lender, so a single person reads your file and signs the term sheet. Below are the neighborhoods investors work in, the deals that trade across the city, the tax question in more detail, and how fix and flip loans in Fort Worth, DSCR loans in Fort Worth and new construction loans in Fort Worth are put together on real addresses.

The most common investor house in Fort Worth is a one-story single-family of roughly a thousand square feet on a pier and beam or slab foundation, built somewhere between the twenties and the sixties. On the east side these come up as estate sales, long vacant houses and tired rentals. The rehab usually covers the roof, the electrical panel and wiring, plumbing that has been patched for decades, a kitchen and a bath, and sometimes a foundation adjustment. That last item is worth a separate bid from someone who levels houses for a living rather than a line in the general contractor's estimate.

Many of those houses are bought to keep. A three-bedroom east side house after a full rehab rents to a broad pool of tenants, and the BRRRR shape of buy, renovate, lease and refinance fits the prices there better than it fits most of North Texas. The question that decides whether the refinance works is the one this page keeps coming back to: what the house will cost to own once the county has caught up with it.

Flips trade in the closer-in neighborhoods, where a finished house sells to an owner-occupant for a meaningful premium over a dated one. In Fairmount that usually means a restoration rather than a gut, because the historic district guidelines shape what you can change on the outside, and the buyer for that house is paying for original detail.

Infill is real across the east and southeast sides. Vacant lots sit inside built neighborhoods, and new single-family houses on them sell to buyers who would otherwise drive much further out for new construction. The work on those deals is confirming the lot is buildable, that utilities are at the street, and that the builder has a realistic schedule for permits and inspections in this city.

With no state income tax, Texas leans on property tax, and a rental in Fort Worth carries a bill from the county, the city, the school district and often a college district on top. Tarrant Appraisal District sets the value that bill is based on. For an investor holding a house, it is one of the two or three numbers that decide whether the rent covers the debt.

The listing usually shows the seller's taxes, and on an east side house bought from a long-time owner that figure can be misleading. A homeowner living in the house may have had a homestead exemption, a limit on how fast the taxable value could rise, or an over-65 freeze. None of that passes to an investor who buys the house to rent it. The year after you close, the exemption falls away and the bill is calculated as a non-homestead property.

The renovation matters too. The appraisal district has been holding most residential values steady while it moves to a less frequent reappraisal schedule, but new construction and significant improvements are carved out of that, and the schedule itself is a public debate that could change. A house that goes from dated to fully renovated, or gains a bedroom or square footage, can be revalued to reflect the work. Texas does not require sale prices to be disclosed publicly, but that does not mean the district will keep valuing a finished house as if it were the shell you bought.

So I size a DSCR hold here on an estimated tax bill for the renovated house as a non-homestead rental, not on the line in the listing. The appraisal district's site shows the current value and exemptions on any account, and a local tax consultant or the county's published tax rates can give you a working figure. If the deal only holds together on the seller's taxes, it is better to learn that before the option period ends than at the refinance.

Fix and flip loans in Fort Worth put the purchase and the rehab in one facility. Rehab money comes out in draws as work is completed and inspected, so the early draws usually follow demolition, foundation work, roof and rough mechanicals rather than anything a buyer will see in photos. Expect the term sheet in writing within 24 to 48 hours, with closing in 5 to 10 days on a clean file, subject to title.

The after-repair value comes from renovated sales in the same pocket of the neighborhood. Fort Worth changes quickly from one side of a major road to the other, and a flip priced off a citywide median will not survive a buyer's appraisal. Your taxes during the flip matter less than on a hold, but carry still counts, so I look for a schedule the contractor will actually commit to. Pricing is set per deal and stated in the term sheet.

How fix and flip loans work

DSCR loans in Fort Worth are qualified on what the property earns, with no tax returns or W2s in the file. The calculation compares rent to the full monthly cost of owning the house, which is principal, interest, insurance and property tax. In Texas the last two are heavy enough that a house can rent well and still come up short.

That is why I want the tax figure estimated for the house as you will own it: renovated, without the seller's homestead exemption, and at a value the appraisal district could reasonably assign. Insurance on older Fort Worth stock should be quoted on the actual house, roof age included, rather than assumed. DSCR loans close in 14 to 21 days and work for purchases of leased houses and for refinancing out of a bridge loan. Pricing is set per deal and stated in the term sheet.

How DSCR loans work

New construction loans in Fort Worth fund the lot and the vertical build in one facility, from $150K to $1M+. Most of the building investors do inside the city is a single-family house or a small group of them on infill lots on the east and southeast sides, sold to owner-occupants or kept as rentals.

I review the contractor bids before closing. I want a line-item budget, a draw schedule tied to it, and a builder who has completed houses in this city and knows how its permit and inspection process runs. Soil and foundation design deserve real attention on North Texas clay, and an engineered foundation plan belongs in the file from the start. A new house is also valued fresh by the appraisal district once it exists, so if it is a hold, the tax estimate should reflect a new build. These loans close in 10 to 14 days once the file is complete.

How construction loans work

The bridge loan is how a Fort Worth BRRRR begins. You buy a dated east side house, fund the purchase and rehab with me, lease it once the work is done, and refinance into a DSCR loan from the same lender. Because I wrote the bridge loan, the refinance is underwritten on a house and a budget I have already seen, which takes a lot of friction out of the second closing.

The tax question belongs at the front of that plan. If the refinance is sized on rent covering a payment that includes a post-renovation, non-homestead tax bill, I want that estimate built before you buy, not after the lease is signed. The same goes for insurance. Pricing is set per deal and stated in the term sheet.

How the BRRRR bridge works

The house is bought from an estate, and the seller's taxes reflect a homestead exemption that ends with the sale. Before closing, I would want a tax estimate on the renovated house as a rental, because that figure, not the one in the listing, goes into the payment the rent has to cover.

Foundation leveling is carried as its own line with its own bid. On pier and beam houses of this age it is common enough that leaving it out of the budget is a bigger risk than including it.

If the appraisal district values the finished house higher than expected, the refinance proceeds are not affected, but the monthly cost is. I would rather see the deal clear with a conservative tax figure and have the actual bill come in lower.