How do I work with a Hard Money Mortgage Lender

Hard Money Mortgage LenderHard Money Mortgage Lender

In the world of poor credit for investors the best choice is to work with a Hard Money Mortgage Lender. Using a Hard Money Mortgage Lender makes it so that the opportunity to invest is based more on the Asset’s Equity than your credit score. Hard Money Loans are a good way to get a property purchased and ready for rehab or renting on short term finance.

There are many that don’t want to live according to their credit score and using a Hard Money Mortgage Lender is a great way to do just that.

Where do you find a Hard Money Mortgage Lender

They say Google is everyone’s friend. It sure can be.

When used properly, Google can get you to the right company. Be aware though that google can also take you to lead generation sites that are marketers looking to sell your information to actual brokers making it a deal where there is more than one or two people involved. It could mean you’re paying a higher price to get that Private Money or Hard Money Loan.

Hard Money Mortgage Lenders have generally higher interest rates and are more willing to look at the property that you’re looking to finance rather than you.

It is a good idea however to do your best to put your best foot forward.

Hard Money Mortgage LenderMake a good impression with your Hard Money Mortgage Lender

When reaching out to a Hard Money Mortgage Lender, take note that they may want to check income and credit just to be sure they can qualify you a bot more than usual.

Even with our Private Lending Group, we’ve found that making sure someone can actually afford the payments has made a great difference in the amount of defaults with self employed investors. It’s not that we don’t want to lend, it’s that we don’t want to take back properties. It’s a long and arduous process no matter what state you live in and it’s just better business to be prepared to handle the cost of money into your formula for success.

Make sure if you do have challenged credit you have a Letter of Explanation and if you don’t have trackable income, be prepared to have longer conversations or to be passed on when it comes to lending. Many Hard Money Mortgage Lender are now following the path of checking on the borrower a bit more. It makes it safer for all sides. Protecting the borrower and the investor/lender.

If you want to learn more you can always reach out to us via the number on the website, or click here to apply for a Hard Money Mortgage Loan.

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How Hard Money Can Make You Killer Profit

Hard Money

Hard Money as a Profit Maker

Using Hard Money as a Profit Maker is fairly easy. It’s running the numbers so it makes sense that isn’t.

If you haven’t gotten a mentor to help you or don’t have calculators, (which by now you should have searched out online; there is a ton of them) you’re shooting blind and your profits will get eaten up quickly.

And it’s not just about running numbers on a calculator either. It’s about knowing your risk and how much you are going to make on the back end.

What’s a good “rule of thumb” for Hard Money

A good rule of thumb as far as profit margins should be about a net of 30% or a cap rate that gives you a good spread on your investment. (GREEK ANYONE?)

Let me explain:

30% net profit is what you have left after paying off your finance and equity partners and counting all costs involved in the transaction of securing the property. The rest of the costs (Title, escrow, commissions if any, other miscellaneous costs) would probably bring you down to about 20% or so. This is really more for rehabbers.

Hard Money

Become a Private Lender

On the buy & Hold side, many look only at the return of a deal rather than the risk. Beware! Just because it says there’s a cap rate of 12%, doesn’t mean that’s what you’ll end up with in cash flow. Using Hard Money is a great way to leverage risk off of you, however it can hurt you as well if you’re not careful on figuring out risk in an investment. (if you’re not sure how to figure on that, we’d be happy to discuss your project and see whether or not you are looking at a viable deal.

Your biggest challenge is to be sure you have something that has a great return after paying expenses, not just great returns.

Know your Hard Money Lender

I see a lot of newbies calling around and asking the same questions as if it’s on the lender that they have to prove their worth working with. (I always get a chuckle out of that) Hard Money Lenders are there to serve you, sure. Remember too though, that they are more like a partner than just your servant. You’re going to have to qualify with them too. And if you don’t know how to figure out the above, it won’t matter how good a lender they are, you’re not getting that Hard Money anytime soon.

Invest in education. It’s a good thing, however, don’t just take that “guru’s” advice and goo out and qualify the lenders, qualify your deals.

When you have a good deal with low risk and great return, you’ll have money knockin on your door. Hard Money that is.

Apply for your Hard Money Loan by Clicking Here

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Invest Now with Private Money Loans to Back You

loan app approved

Private Money Loans are still very much available

Living in San Diego which just became the most exclusive place to live per the UT San Diego (click here for article), doesn’t have to be a challenge. Most investors know that if they can secure a good deal on an investment property there is such an influx of people coming to live in San Diego that it’s very possible to find a cash flowing property. Most investors are wary when the cost of acquisition gets to be in the higher amounts. The savvy ones know to work their numbers just right so they can gain a good cap rate and recover investment quickly.

San Diego has long been a very coveted area for living alone. Now it’s become a great place to hunt for a good deal and get a cash flowing property online in their portfolio. With foreclosure rates lowering one may think that finding a “good deal” is not as possible. From our contacts in the region, that just isn’t true. There are still deals available on the market. You might have to dig a bit, but they are there.

When it gets expensive, Private Money Loans are a great way to go

Offsetting up front monies by using Private Money Loans is a great strategy that many investors use. In the San Diego Market it makes even more sense to use Private Money Loans to get the deal done. It lessens the layout of the investor up front, and in the long run can allow an investor to be looking for other opportunities.

Another advantage of using Private Money Loans is the ability to increase equitable profit on the back end if you’re planning on fixing and flipping. Because you’re paying Interest only in most cases, even though you aren’t paying down principle, you are looking to the profit on the sale. (hopefully you’ve made your money when you inked the sales contract and aren’t hoping for profit on the back end)

Private Money Loans allow Investors such as yourself to increase your net worth faster and in a market like San Diego, using Private Money Loans are a definite way to increase your net worth. (On paper, you’re the owner you can claim the worth)

Private Money Loans are available

Private Lending Group is currently working with private investors that want to lend in the San Diego area and we are at the ready to take your application and get your funding. We can lend up to 65% of LTC (purchase price and repair). We have conventional programs that can help as well if your credit is good enough. (call to find out how to qualify for that program) Those can go as high as 75% LTV (Actual Loan to Value)

Call today to find out how you can qualify your prospective property for a Private Money Loan.

619-512-3464 

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Commercial Hard Money Lenders

Commercial Hard Money Lenders

Commercial hard money lenders are an important alternative to your business’s traditional financing alternatives. A commercial hard money lenders can sometimes make all the difference even if traditional lenders have rejected an loan application as too risky. Hard money commercial loans are always offered at higher rates than bank loans but beyond the cost when few other financing is available, Commercial Hard Money Lenders are a savior when traditional lenders are not lending.

Commercial Hard Money Lenders Requirements

Commercial hard money lenders will consider your property as the collateral for repayment and and not be as strict about credit and income as bank lenders. But commercial hard money lenders are seasoned business people who have no interest in owning your property much less in running your commercial venture. Loans are made based on the same considerations of risk and repayment as they would be at a mainstream lending institution, but the value of the collateral property is of far greater concern. In many cases, you will learn more from someone who has real estate experience both inside and outside of a traditional financial institution than from someone whose experience lies purely on the inside. Buildings or other facilities that your company is currently using may not be considered. Rather, a commercial hard money lender will be looking at the overall value of the business and especially at its resale value of the business.

Short Term Commercial Hard Money Loans

Hard money commercial loans are typically very short term loans. A commercial hard money borrower can expect repayment terms for periods of between 1 and 3 years. But commercial hard money lenders also do a good amount of business simply because they can close deals faster than traditional lending institutions ever will and closings in as little as ten days are sometimes possible. Some commercial hard money lenders will syndicate groups of private investors for every deal each deal while others actually hold big mortgage funds and can very quickly make those funds available within a period of days or a few weeks. Commercial hard money lenders know that the loans they offer are at a premium cost, and therefore they won’t stretch out terms but should be able to talk to you quite frankly about the length of time for repayment and about your ability to repay.

For more information on terms and qualifying click here.

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