Jeffrey Putnam is a Senior Mortgage Loan Officer at The Magnolia Group, a division of the mortgage brokerage firm NEXA Mortgage. In his role, he specializes in investor and short-term lending. Before joining NEXA Mortgage, Jeffrey held positions at Finance of America Mortgage LLC and PNC Mortgage.
Here’s a glimpse of what you’ll learn:
- [9:31] Jeffrey Putnam shares how he got into lending and discovered alternative financing solutions
- [15:05] Key factors lenders consider when funding investment flips
- [21:42] How Jeffrey evaluates deals and identifies profitable opportunities
- [24:54] A comparison of current conventional loan rates and historical trends
- [28:45] Incentives and loan options for first-time homebuyers and flippers
- [33:14] The potential risks and mistakes of flipping
- [41:46] Jeffrey and Jake Hanes talk about their craziest adventures
- [52:19] Jeffrey recounts his experience in the mortgage industry
In this episode…
Flipping homes and investing in real estate can be lucrative yet unpredictable. From financing to hidden repair costs and unreliable contractors, one wrong move can turn projected profits into painful losses. How can real estate investors avoid costly mistakes and fund their projects with confidence?
Short-term lending and real estate finance expert Jeffrey Putnam leverages smart investing techniques to minimize risks and maximize ROI on flips and construction projects. Hard money loans are ideal for real estate investors who need fast access to capital without the hurdles of traditional financing. Conversely, bridge financing allows investors to transition between properties seamlessly. With DSCR (Debt Service Coverage Ratio) lending, self-employed borrowers can qualify for loans based on rental income rather than tax returns. In addition to these strategies, Jeffrey recommends thoroughly vetting contractors, accurately estimating rehab costs, and planning for contingencies like unexpected repairs or delays.
Tune in to the next episode of Work Hard, Play Harder as Jake Hanes sits down with Jeffrey Putnam, Senior Mortgage Loan Officer at The Magnolia Group, a division of the mortgage brokerage firm NEXA Mortgage, to discuss smart financing strategies for real estate investors. Jeffrey discusses market trends, first-time buyer programs, and the lessons he learned from high-stakes flips.
Resources mentioned in this episode:
Quotable Moments:
- “I got into this crazy business in 1992, back when they didn’t even have FICO scores.”
- “If the loan can close quickly, especially on a flip product, it’s a great tool to use.”
- “You don’t want to just slap it together as cheap as possible… use good quality stuff.”
- “Before you do it, make sure you have a good contractor who knows what they’re doing.”
- “It was a great niche and a great tool for investors to use when they can’t qualify.”
Action Steps:
- Vet every real estate deal with a full cost breakdown: Understanding all expenses — like rehab, loan fees, and closing costs — can prevent profit loss and surprises. A clear spreadsheet of projected costs ensures informed, data-driven investment decisions.
- Use DSCR loans for non-traditional borrowers: These allow investors to qualify based on rental income rather than tax returns or W-2s. It’s an ideal strategy for self-employed individuals looking to grow their real estate portfolio.
- Work only with experienced, reliable contractors: A skilled crew can make or break a flip by avoiding delays and subpar workmanship. Vetting contractors thoroughly helps keep projects on schedule and within budget.
- Plan for the unexpected with a contingency buffer: Budget 10% over project estimates to allow for unforeseen costs. This cushion helps you stay solvent when surprises like wiring issues or roof repairs arise.
- Leverage hard money and bridge loans strategically: These fast-close options are perfect for competitive deals where traditional financing falls short. They offer speed, flexibility, and accessibility when time is critical.
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