Setabay Private Hard Money Lender: January 2019

Thursday, January 31, 2019

Why Borrowers Are Considering Commercial Texas Hard Money Lenders

Borrowers who are having trouble obtaining loans from traditional lenders often have to turn to other sources. Read more below to learn about untraditional lenders, and why borrowers are seeking alternative loan agreements.

Obtaining funding for a loan can be difficult. Factors vary for each individual, and depending on the requirements of the lender, obtaining funding isn’t always a simple process. More often than not, low credit score and a weak financial history makes for rejected loan appeals, causing borrowers to look elsewhere or cease searching.

Fortunately for borrowers serious about obtaining funding and working towards a stronger financial ground, other options are available. After being rejected by a traditional lender like a bank, borrowers often turn to commercial Texas Hard Money Lenders to obtain the funding they need.

Cons of Working with a Private Loan Investor

Private loan investors offer hard money. These lenders may be an alternative loan agency, a company, or a wealthy individual looking to make a profit. One thing to know is that not all private loan agencies are legit—and, if they are, they often have higher interest rates and the possibility of hidden fees within the loan agreement. Doing research into your commercial hard money lender is essential. There are many valid options but turning to an unreliable and predatory lender won’t help your case. Additionally, it is always a good idea to research their project history—what kinds of borrowers they have helped, and their success rate. If you fit into their category of borrowers, they are likely a great option for you. As long as you take into account the short repayment period and higher fees, it is likely you are eligible for a hard money loan and will find success obtaining funds.

Pros of Working with a Private Loan Investor

Though working with a private loan investor will require assurance, there are benefits to working with private investors. Unlike banks, they are able to approve a wider group of people because they consider the property’s collateral before they consider the borrower’s financial history. This does not mean they do not review your past finances. It just means that they are likely to approve someone with an imperfect credit score if they see value and potential profit in the loan investment. Not only are private investors able to approve more people, but they are able to approve them faster. Sometimes, the loan process can begin as soon as the day of—public lenders like banks are not able to do this. Public lenders usually need about a month to get started. The flexibility of private investors is seen in their ability to approve and their speed. Inherently, flexibility often leads to other things, like a transparent relationship and an individual experience. While hard money loans are expected to be paid on a short term time period, there is usually the ability to work with the lender and expand it, if necessary. Working with a commercial hard money lender has many benefits, and if you do your research to find a reliable local investor, it is likely you will find in them an alternative to traditional lenders.

Dennis Dahlber Broker Ri CEO Level 4 Funding LLC Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC
Hard Money Lender
Hard Money Loans
Hard Money Loan
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis@level4funding.com
Dennis Dahlberg Broker/RI/CEO

About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 43 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

How to Bridge the Gap with Arizona Bridge Loans

Obtaining funding for your next home can be extremely stressful, especially if you are struggling to sell your current home or wishing to move into your next home first. Fortunately, “bridging the gap” is a great option if you are in either of these situations.

“Bridging the gap” is another way to refer to swing loans or, more commonly, Arizona Bridge Loans. The referral to any references the ability to borrow using the down payment on your current home, with the intention of using it to purchase the next. It is an option that allows people the freedom of contingencies in contracts that require that the current home be sold first. The transitional metaphor of moving from one home to the next as such is seen in the word “bridge.”

Benefits of Arizona Bridge Loan include a lack of major transition period between buying and selling your home, without having to utilize a temporary living space. Freedom is also found in the ability to search for homes with no limitations or pressure when the ideal home is found. These loans are also common solutions for small renovations or relocations. These benefits to the borrowers are contrasted by the benefits to the lenders which include high interest rates and short-term, low-risk repayment.

How to Know What’s the Best Decision for You

Qualifying for these loans means having a great credit score and low debt-to-income ratio. If you meet these requirements, you should also consider these other factors before diving right in. Eligibility is great, but eligibility for the loan doesn’t cover a few other things, which includes the fact that you will have to pay a mortgage for two properties. Not only that, but they are expected to be paid off in 6 to 12 months, which is typical of short-term loan repayments. And, while loan interest rates vary from lender to lender, they are typically 2% higher than most on the market and will be affected by the home’s loan to value ratio LTV and your personal financial history. Doing research on the current real estate market will help you evaluate how your home will fare on it, though it should always be done anyway before making any fast decisions. It’s not unheard of for loan extensions to be offered, should your current home be struggling to be sold on the market.

Being Successful with Alternative Options

A lender for Arizona Bridge Loans can be found at your local bank or credit union. Alternative routes also include seeking out information for a 401 k or a home equity loan. Home equity loans are common solutions, despite the requirement of needing a high credit score and steady income. These loans work by taking a second mortgage on your home that is then used towards new loan funding. If you are seeking something with low interest rates, personal loans are a great option that can be combined with other types of loans if needed. Before making any fast decisions, it is important to thoroughly analyze all of your options and determine what short- and long-term goals you have that would be benefited by each type of loan option. If “bridging the gap” is not the right option for you, there are plenty of alternatives that promise success in various situations so that you can have your dream house.

Find a Lending Niche: Private Money Lenders Arizona Form a Lending Mecca for Real Estate Investors

Private Money Lenders Arizona may be the means to setting estate investments into motion.

According to a recent article by Forbes, private money lenders are changing the lending industry by financing real estate investors rejected by conventional lenders. Supporting this notion, Bobby Montagne from the Forbes Real Estate Council writes: this “reluctance [to fund real estate investors] has created a growing national market for Private Money Lenders Arizona and a lucrative opportunity for investors in private loan investment funds.” In the US, a capitalistic economy were businesses depend on venture investors, this is great news—the possibility of having lenders lending more money at more competitive rates. Supply and demand.

So why all of the fuss about Private Money Lenders Arizona? What is moving so many investors to get funded by them? Well, many real estate investors are shrewd and eager to see a good return. Whether they are a first-time, ma-n’-pa outfit or a seasoned band of weekend warriors, real estate investors typically look to invest in distressed property, renovate, and generate profit. The problem many real estate investors run into is that banks typically do not like lending on undeveloped property or distressed property. This is problematic for contractors wanting to build a spec home from the ground up. Also, this is problematic for flippers and those who rent because buying destressed property at wholesale value and fixing it up offers more profit than buying a property that needs minimal renovation.

The stone cast out by the builders has becoming the corner of the foundation. Setting the banks aside at first is a good strategy for many real estate investors because they can initiate funding: Private Money Lenders Arizona who step up to the plate and fill in a needed lending gap.

Who Benefits from Private Money Lenders Arizona

Filling the gap is no small thing. Montagne goes on the state that “With the median flip priced at $189,000, [it’s] a $56 billion market.” That’s a lot of money, folks, and a lot of money coming from private investors. Where the proverbial door of conventional banking closes, the door of private lending stays open. This is quid-quo pro. Private Money Lenders Arizona get a good return on roughly 7%-14% of their investments and are covered by the LTV they wish to set. By charging more than conventional lenders they are rewarded more. Real estate investors win by finding a funding niche.

Private Money Lenders Arizona are the financing start that allows for a strong and profitable finish.

For real estate investors with poor credit, the advantage is the ability to find sub-prime lending in the wake of Dodd-Frank. For real estate investors with stronger credit scores, the advantage is finding lending to get the job started. Grease the wheel and get it turning, get a loan on barren or destressed property, build or renovate, then acquire conventional funding. Private money can bridge between hard and conventional, it can start the pace and allow the money to trickle in. Though higher at first, it is a start that allows for a strong finish, a profitable finish.

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC
Hard Money Lender
Hard Money Loans
Hard Money Loan
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis@level4funding.com
Dennis Dahlberg Broker/RI/CEO

About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 43 years. They have 2 beautiful daughters and 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

Hotels Are Losing Money: Investors Earn an Extra Buck with an Arizona Airbnb Loan

Arizona Airbnbs are helping small investors eke out a living by taking businesses from the goliath of the hotel industry. Backed by the tech firepower of Arizona Airbnb applications, little guys are rope-a-doping giants.

In the past, hotels were the way people vacationed in the States. Families would plan a vacation to a remote and exotic region, do research about that particular area noting the touristic attractions, and finally book a hotel that was of a reasonable name, rating, and price. For years, this was the ritualistic pattern: In the prehistoric Age of Analog, travel agents, salespeople, and a vast amount of phone calls were needed to go on vacations, buy things, do things, stay places. The process was arduously long, may have taken months to plan, and possibly a good chunk of change to set in motion.

Then, from the obscure depths of algorithms, turning machines, and half-mad scientist and mathematicians, the computer emerged. Next, a labyrinth of networks—then, networks of networks leading up to the internet. Al Gore claims to have created it. People could now talk to each other over vast distances. Businesses could now post product prices online. Travel agents fell out of vogue. Middlemen and their commissions lessened. Software caused fluctuating market standards.

The year—2008. Enter Airbnb. Arizona Airbnb created a software platform that allows people to rent out houses for a fraction of the cost of a hotel room. Arizona Airbnb at first was a small threat to hotels and vacation rental companies. Then it grew, exponentially.

The year—2018—the present. Arizona Airbnb has reached a value of $30 billion plus. The hotel industry is now running scared. It has lost billions of dollars over the past few years. Not only is Arizona Airbnb making a lot of money, but people using Arizona Airbnb are incentivized to make money by renting out property. Quid quo pro. People are using services that fill their own pockets. Though a tech giant, Arizona Airbnb helps the little guy rake in some more dough.

Arizona Airbnb Loan for an Arizona Airbnb Business

How are people renting out property? Well, many individuals already have a mortgage on a home. Maybe they have a guest room or guest house to rent out. Renting out rooms helps them pay their mortgage off faster. However, there is another category: those looking to make an Arizona Airbnb business with an Arizona Airbnb loan. By using hard money brokers and lenders, these individuals find an attractive vacation rental property with a favorable occupancy rate. Next, they find a hard money lender who is willing to give them an Arizona Airbnb Loan at a favorable LTV percentage. Occasionally distressed property is renovated to save money on acquiring a rental property.

Start an Arizona Airbnb business with an Arizona Airbnb loan.

In the end, a property is purchased and rented out ideally earning more per annum than the debt owed to the hard money lender. With an evident and favorable return percentage this step may be repeated. An Arizona Airbnb loan forms a vacation rental chain with a decent return may be established.

About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 43 years. They have 2 beautiful daughters and 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

Advantages of Commercial Texas Hard Money Lenders for Your First Fix and Flip

Choosing the next big investment is never easy—hours of binging HGTV doesn’t necessarily prepare you for what goes on behind the scenes. If you’re interested in learning more about the loan process for fixer uppers, pause HGTV and read more below!

It’s no question that the major personalities on HGTV today have the money to afford fixer uppers, with more than a little wiggle room for error. But what about the average person looking to break into the biz for the first time? Their wiggle room is certainly smaller, and their chances for error greater. So where do they go when they need to obtain funds fast for a fix and flip?

Oftentimes, people will turn to commercial Texas Hard Money Lenders. Commercial Texas Hard Money Lenders are untraditional alternatives to public lenders like banks and credit unions. What these untraditional, private investors do is evaluate the potential and collateral of the property. In this way, private investors are able to approve a wider range of people compared to public lenders because they highly consider the property’s potential profit line first. Though your financial history will be relevant to them, collateral comes first.

How Fixer Uppers Inherently Lend Themselves to Hard Money

Speed is one characteristic of hard money that can come in handy when obtaining a property off a competitive market. The ability to obtain the property with all of the ideal characteristics for a fixer upper will be ideal. Committing to a home that won’t provide any nasty surprises after the purchase will lead to more success in the long run. Being able to get funds fast may just allow you to get that ideal property for flipping. Commercial Hard Money Lenders allow for this and flexibility. Because they are more likely to approve you for a loan than a bank, it is also more likely that they will allow a little flexibility when it comes to repayment. The repayment period of hard money loans is short. This lends itself to fixer uppers because the goal is to fix, flip and sell quickly.

What You Need to Know Before You Move Forward with a Private Investor

While the short-repayment period and the fast funds make hard money a great option for people looking to flip, there are a few things to know about Texas Hard Money Lenders before diving in. First, Texas Hard Money Lenders have high interest rates. Their ability to approve a wider variety of borrowers is balanced by their higher interest rates. Coupled with a short-repayment period, this option may not be ideal for everyone, though there are benefits to consider. Second revolves around reliability. Reliable commercial Hard Money Lenders are out there, but so are unreliable agencies. Being confident that your lender supports the project and won’t pull out at the last minute is obviously going to be a concern to have. Researching their past clients and projects is one way to go about ensuring they are legit, but so is hiring a real estate attorney. A real estate attorney will be able to evaluate and determine if they are really a reputable agency and if they have any hidden fees and stipulations you may have missed. Doing thorough research will help you determine if Texas Hard Money Lenders are right for you and your personal financial situation, even though their process and typical benefits lend themselves to those fixing and flipping properties.

Do Private Money Lenders Work Like Traditional Loan Lenders?

Considering a private money lender is a common evaluation for anyone deciding on the best loan choice for them. It certainly was for Brianna and David when they didn’t qualify for a traditional public loan and learned the major differences between private and public lenders.

Brianna and David wanted to invest in a fixer upper. When they approached their local public lender, their nearby credit union, they found that they did not qualify for a major public loan. To do so, they needed a strong credit score and a solid debt to income ratio. Unfortunately, to seek out their dream of flipping a house, they would need to seek untraditional options.

Brianna and David were certainly a little wary of Colorado Hard Money Lenders—they were unsure what to expect, and the promise of an easy approval process made them suspicious. As they began to learn of their options, they became aware that private money lenders could offer a few things: money and speed.

Finding Success with a Hard Money Lender

Brianna and David didn’t rely on speed when it came to obtaining their loan. They weren’t working to prevent a foreclosure and their property wasn’t particularly competitive. Still, the prospect of speed was attractive. They found that their hard money lender could begin the loan process as soon as a day—something banks couldn’t get close to matching. Public lenders typically need a month to begin the loan process. As Brianna and David discussed prospects with their private money lender, they learned of their lender’s flexibility. For one, their lender could approve their loan request based on the potential of their property—and since the loan would be going toward a project that would be reaping benefits and a high probability of making a profit, they were able to qualify. Second, their lender was also open to expanding the terms of their loan agreement. Hard money loans work best with people seeking out funding for short-term projects, but they can sometimes be expanded with the right lender. Brianna and David were happy to learn their lender believed in their circumstances to support an extension.

Effects of Eligibility

Brianna and David were thrilled to come to an agreement with their private money lender. However, as they looked over the terms to the agreement, the major differences between a private and public lender were much more apparent. For example, private lenders have high fees and interest rates incorporated into the loan. This is something that banks do not do, and private lenders do this to weed out potential clients, and help ensure the reliability of their borrower, if it isn’t immediately reflected in their credit score or debt to income ratio. The high costs combined with the comparatively steep interest rates often weed out a lot of potential borrowers because, while the easy approval process may deem private lenders “affordable,” the hidden costs reveal they are not. Brianna and David weren’t thrilled about the fees, but found that, with some work, they could afford them provided their property didn’t come with any unfortunate surprises. Fortunately for Brianna and David, their hard money lender was a great option for their first fixer upper. Though it was costlier than they expected, they were able to complete their project successfully.

Setabay Private Hard Money Lender