Setabay Private Hard Money Lender

Monday, September 11, 2017

Who Uses Hard Money Loans for Commercial Lending

Numerous borrowers use hard money loans for a variety of reasons. From real estate investors looking for Texas Commercial Lending options to home buyers and businesses, there is usually a private hard money lender that can fund your next project or purchase.

Many erroneously believe that the only time individuals and businesses turn to private hard money loans is when their credit score or debt-to-income are such that traditional Texas Commercial Lenders will not approve their loan application. The truth is that many real estate investors turn to these types of loans because of their quick approval and funding time. When a property comes on the market that peaks the interest of a real estate investor, you can be sure that more than one has spotted its arrival. In today’s market, it often takes quick access to capital in order to obtain the best properties for either fixing and flipping or buying and holding. While traditional funding can take over a month, a private hard money lender can get you the funds quickly, sometimes in just a few days.

For this same reason, contractors are also a common client of private hard money lenders. These asset-based loans are short-term, usually up to 24 months, and they offer draw programs for construction companies. Their interest-only payments allow companies and individuals to complete a project and sell it or obtain a traditional loan at the new after-repair value (ARV).

Home owners are drawn to bridge loans—these types of loans are provided by private hard money lenders to act as a bridge from one asset to another. If you want to purchase a home before you sell your current one, a bridge loan will give you the money you need so that you do not have to make a contingent-on-sale offer which can often mean the difference between acceptance and rejection in a seller’s market. Real estate investors use these types of Texas Commercial Loans as an alternative to obtaining an equity partner, for buying out said partner, while waiting for Texas Commercial Lending from a conventional loan to come through, or as a down payment for a build-out project.

Loans for Small Businesses and the Self-Employed

Small businesses use private hard money loans when they are in need of immediate cash. This occurs in seasonal businesses that may need additional capital to stock up for the upcoming busy season or to keep operations going during the slow season. They also use these types of loans for purchasing needed equipment. Some startups you this type of funding due to the difficulty of obtaining a conventional loan. The self-employed fall into this group as well.

Texas Commercial Lending from a private hard money lender is easier to obtain and provides fast capital when businesses are in need.

At Level 4 Funding, we have provided needed capital for small businesses, home owners, real estate investors, and contractors. Call us today to see if one of our many loan programs might be the perfect fit for you. We work with hundreds of hard money investors and know the businesses, properties and projects that appeal to each and every one of them.

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC Private Hard Money Lender
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701

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 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

What you can do to help your Private Hard Money Texas Commercial Loan Application get Approved

You may be turning to a private hard money lender for needed capital for a business loan, a real estate investment, or the purchase of a new home. Whatever the reason, there are a few tips to consider that may just help you get the Texas Commercial Loan you are seeking.

A hard money lender bases their loan on the collateral supplied by the business, property or home you are purchasing. In addition to using the collateral of what you are purchasing, you can also use personal assets such as your existing home, vehicle or other personal property. If you are applying for a Texas Commercial Loan for an existing business, you might consider using the equipment as collateral.

Have a business plan and budget. If you are applying for a buy and hold or a fix and flip real estate investment, take pictures of the property’s interior and exterior. Because a hard money lender is more concerned about your asset than your credit score, they will want to know that you know all that goes into a renovation or rehab project. To this end, unless you are planning on doing all the work yourself, be sure to get bids from contractors and include these in your budget. Have a detailed plan and know your numbers.

In most cases, your payments will be interest only until the end of the project, or your home sells, or the accounts receivables from your business starts to flow in. Because of this, private hard money lenders require an exit strategy. How do you plan on paying the lender back at the end of the Texas Commercial Loan terms or when your project is complete? For instance, a loan for a fix and flip property usually has its sale as the exit strategy. They will want to know that you know what you are doing. Again, if it’s a fix and flip property, what is your knowledge base regarding markets, construction and real estate? Do you have a real estate license? All the better.

Documentation for Texas Commercial Loans

Hard money lenders differ in their required documentation. Most will require a purchase contract or, if you are refinancing, a payoff statement. A proof of funds statement may be required in order to verify that the borrower has enough money for the down payment. This is usually in the form of a bank statement. Proof of insurance will be required. If this is a real estate investment that is going to require renovation and rehab, they will also want to see your budget, plans and exit strategy.

Many contractors and real estate investors turn to private hard money lenders for Texas Commercial Loans.

At Level 4 Funding, we offer construction loans with terms up to 24 months with monthly draw programs. These loans are easy to qualify for and quick to fund. Funding for commercial and residential real estate is available for up to $50,000,000. The documentation we require is a copy of your budget, plans and permits. Call us today for a no obligation quote.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

The Good and Bad of Credit Unions for Texas Commercial Loans

If you’re looking into getting a Texas Commercial Loan from a credit union but uncertain if you would qualify, know that times have changed. All credit unions are not “members only” anymore; in fact, several are open to the public.

There was a time when getting an account and loan from a credit union required association with a certain company or organization. Fortunately, those times have changed. While many still have strict criteria for joining, otherwise known as Field of Membership (FOM) qualifications, others have found a way to allow almost anyone to join. Even those with stricter rules allow family members to enter the sacred circle. Credit unions are not-for-profit institutions that exist to provide their members with banking products and services. Members are also considered owners. Here are just a few of the credit unions that anyone can join: GTE Financial Credit Union, Alliant Credit Union, Connexus Credit Union, and American Heritage Federal Credit Union. Most require a one-time donation to a certain organization. After opening up a bank account, you are then qualified to apply for a Texas Commercial Loans.

Credit unions often offer competitive interest rates and, because members are owners, usually are more personable in their approach. In order to get a Texas Commercial Loan at a credit union, they will need to know your debt-to-income ratio as well as how long you have been at your present job. As with other lending institutions, self-employment can offer some additional challenges. Your credit score and creditworthiness is also taken into account.

According to an article in Forbes, credit unions stepped up to the plate during the Great Recession. When small business lending decreased during 2007 to 2010, credit union lending rose in terms of the percentage of loan to assets. In 1998, legislation went into effect that capped the amount of business loans that credit unions could make to their members. This cap is 12.25 percent of the credit unions’ assets. The National Association of Federally-Insured Credit Unions continues to lobby against what they consider a counterproductive and arbitrary cap.

A Credit Union versus a Private Hard Money Lender

A credit union is considered a traditional lender while a private hard money lender is considered an alternative. They do not fall under the same regulations nor do private hard money lenders require high credit scores and creditworthiness. Their chief concern is the collateral that you are bringing to the table. They also want to know that you have some skin in the game—something to lose should your project or business fall by the wayside. While each hard money lender has their own unique processes and guidelines, most require some of these documents, depending on the type of loan, to be submitted when applying: executed purchase contract, proof of closing funds, an executed purchase contract, budget, business plan and exit strategy.

A private hard money lender offers quick capital without the need for 700 plus credit scores.

At Level 4 Funding, we approve private hard money loans for businesses, homeowners, real estate investors and contractors. If you’ve been turned down by your credit union or bank, give us a call. As long as you have adequate collateral, a good exit strategy and a solid business plan, a private hard money Texas Commercial Loan could be the solution you seek for needed capital.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

The Present Housing Market and Commercial Lending

The housing market has definitely made a recovery from the lows of the Great Recession. Here are the markets to avoid and to embrace and the current Texas Commercial Lending trends.

For those individuals looking to delve into the lucrative real estate investment strategy known as single-family homes, now may be a very good time. Median home prices are on a fairly consistent upswing, particularly in metropolitan areas where record appreciation has been experienced. It’s safe to say that the housing market has officially recovered from the subprime mortgage crisis 10 years ago, at least in most markets.

There are a few lingering markets such as Las Vegas which experienced such a rise in development that rotten home loans and the Great Recession has left it on a slow recovery spiral. One in four homes is worth less than the loan on them. On the other side of the market you have San Jose, the nation’s most competitive housing market. Back in March, almost 70 percent of the homes were selling for more than their list price. The median listing price is close to $800,000 and the closing price is $846,000. Other markets are moving even faster. Spring saw Denver and Seattle with the fastest moving markets—an average of only eight days on the market. Homes in these two distinct metropolitan markets saw double-digit increase in home values in 2016.

Somewhere in between the two lies the sweet spot for Texas Commercial Real Estate investment. If you’re a contractor, even sweeter. The subprime mortgage crisis left a bad taste for many builders who were slow to enter the fray yet again. This, along with first-time home buyers and retirees tending to stay put due to rising costs, has led to a housing shortage. So where do beginners jump into a market on the rise? Some of the best markets for rental homes are Rochester, N.Y., Memphis, Tenn., Indianapolis, Ind., and St. Louis, Missouri.

Housing Markets and Texas Commercial Lending for First-Time Texas Commercial Real Estate Investors

With rock-bottom interest rates, a steadily improving economy, and a stock market that experts are suggesting may be ready for a correction, many investors believe that a real estate investment strategy may be the best option for those looking for multiple streams of income and steady growth. The trick is to look for properties that will immediately grant you a positive cash flow, not always an easy target. Because of the housing shortage, home owners are able to sell their home that may not be in perfect condition. Consider mortgage, taxes, utilities and bills such as landscaping and maintenance and the rent that will cover those bills and more. Even if you come out even, your tenant is paying your mortgage and you are building your portfolio and equity. Once you’ve found your property, you’ll need to find a Texas Commercial Lending strategy that works for you.

A private hard money lender can be your entrance into the single-family home market.

Conventional Texas Commercial Loans are not always easily obtainable. They require excellent credit scores, experience, a certain debt-to-income ratio and a lot of patience. Texas Commercial Lending obtained from a private hard money lender requires less documentation and quick capital—often in as little as a few days. At Level 4 Funding, we can let you know what loans we offer that may fit your needs and we will let you know if you are approved in as little as 24 hours.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

The Current State of Texas Commercial Real Estate Investments and Commercial Lending

Commercial investment sales are down from the historic highs of last year due, in part, to tightening of conventional commercial lending. Alternative lenders are stepping in to fill the gap.

While all commercial properties are seeing price gains, the investment sales volume is down. July’s volume totaled around $36 billion which is down from the historic highs of 2015 and 2016 when sales came in at approximately $52 billion and $47 billion respectively. Even though deals have gone down, the prices continue to rise. For instance, multifamily properties, though showing a slight decline this month, have prices up 9.6 percent from last year. According to JLL, large transactions over $250 million are down 27.7 percent year-over-year. Their Q2 2017 Investment Outlook showed investment sales growth in all sectors was down except for industrial which showed a 20.7 percent growth. Office, multifamily and retail was all down in the double digits. So why the slowdown?

Several factors seem to be contributing to fewer handshakes between real estate investors and commercial property owners. One of these is an increasing conservative approach in traditional Texas Commercial Lending underwriting and the resulting increase in time to funding and barriers to entry. Other factors include our present political climate. Retail is down due to tenancy risk though outlets with strong anchors are still performing well. Multifamily numbers are affected by the slowdown in high-rise transactions as newer generations are searching for walking-friendly neighborhoods with a strong sense of community. Joint ventures, recaps and entry-level investments are on the rise while conventional single-asset sales are showing a decline.

With banks tightening, alternative lenders are stepping in to fill in the gap. With rising costs and higher labor in the construction industry, traditional lenders are being more selective and contractors are looking to non-traditional options. One of these Texas Commercial Lending options is private hard money lenders. These non-traditional asset-based lenders have fewer requirements than their conventional counterparts. Credit scores are not as important to the lending process as is the collateral. Capital is acquired in days instead of weeks.

Who Uses Private Hard Money Lenders

Real estate investors often use this type of Texas Commercial Lending due to its rapid funding. Immediate capital may be required to obtain a property just hitting the market or to start a build-out project. Others may have experienced some credit issues due to foreclosure and various life-altering events. Typically, these are ideal for fix and flippers as well as those building equity while waiting for a traditional loan to come through.

Private hard money lenders are stepping in to fill the gap that the current conventional lending institutions are creating.

At Level 4 Funding, we work with hundreds of private hard money lenders. If you are experiencing difficulty in this present lending environment, call us to find out if we have the investor to fill your needs. When the banks have said “no,” we often say “yes.” We offer construction loans up to $50,000,000 with terms up to 24 months, quick monthly draws, and APRs starting at 9.5 percent. All we require is a copy of your budget, plans and permits.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Real Estate Financing and Texas Commercial Loan Options

Obtaining that first Texas Commercial Loan is one of the major stumbling blocks that keeps want-to-be real estate investors from turning their dream into a reality. There are options and one may be just the right one for your needs.

If lack of funds is holding you back from making your move into real estate investing, don’t let it. Very few investors make all cash offers or have the 20 to 35 percent down and high credit scores that some conventional lenders require. These lenders are often banks or credit unions and, while a good option for those that are approved, they do take time to fund—at least a month in many instances. There are alternatives.

Participating Mortgage or Joint Equity mortgages offer alternatives to traditional lending. In a participating mortgage, the lender is offered a percentage of the resale proceeds if the investment is a fix and flip model, or they are provided with a share of the rental income if the property is a buy and hold. In a joint or shared equity mortgage, both lender and real estate investor agree to share capital, risks and rewards. These individuals or groups come together for one project, which is what makes it different from a partnership. Investors often use this strategy when they are looking for knowledge and experience as well as funds. Like any partnership, it’s important to make sure that the two of you hold the same values and vision.

Crowdfunding has become a growing avenue for obtaining Texas Commercial Loans for real estate projects. Equity investors hold a stake in the property while debt crowdfunding, also known as peer-to-peer, investors are paid back in regular monthly installments with interest over a period of time, usually three to five years. Both are funded by numerous individual investors, some of whom may make an investment with as little as $1,000. This type of lending usually requires strong credit scores and solid business plans.

Private Hard Money Lending

Private hard money lenders offer asset-based loans that are typically short-term in nature and provide access to quick capital. Terms are anywhere from 3 to 60 months. Credit scores and creditworthiness is typically not as an important factor as it is with other types of Texas Commercial Loans . The loan is based on the property that you are using as collateral, whether the investment property or your current home. As well as a budget and plan, most private hard money lenders require a good exit strategy which will let them know how they will get back their money at the end of the build-out or renovation. An exit strategy for a fix-and-flip property is typically when the home or property resells while, for a buy and hold investor, it may be when they obtain a traditional loan after the property has been repaired and rehabbed.

A private hard money lender provides asset-based Texas Commercial Loans . Credit scores are, typically, not as important to funding as is the collateral.

At Level 4 Funding, we offer quick access to capital. Approval is often determined within 24 hours of applying and capital may be available in as little as two to three days. Call us to see if we are the right private hard money lender for your real estate investment needs.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Qualifying for a Commercial Loan

Traditional lenders have tightened up their lending standards since the subprime mortgage crisis. Find out how to qualify for a Texas Commercial Loan and what options are available.

Texas Commercial Lenders have tightened their lending standards since the Great Recession. While the requirements have loosened up a bit for larger firms, small businesses are still bearing the weight of the subprime mortgage crisis with only 20 percent of those that apply for a bank loan actually getting one. The 80 percent that receive a rejection notice usually fell short in one of three areas: the necessary collateral, the capacity to repay, their credit score and creditworthiness. Banks often prefer credit scores that are in the 700 range or greater.

The debt service coverage ratio is used to determine if the business will or has generated enough income to pay back the loan and interest plus maintain some cushion. For conventional commercial lenders, that ratio is generally set at 1.25 to 1.45 or greater. In essence, this ratio represents the cash a business has available to service its debt which includes the interest and principal payment of the loan. A ratio greater than one shows that the business has enough to pay its obligations. In order to calculate your debt coverage ratio, divide total net annual income by total annual debt.

Gone are the days when lenders offer Texas Commercial Loans of 80 percent loan-to-value. Nowadays, borrowers are lucky to get 60 to 70 percent loan-to-value. Know what your collateral is valued at before hitting the lending circuit. If you require a larger loan than your business or property is worth, you may consider using your home as collateral or any other assets. You’ll need your balance sheets in order to demonstrate a consistent cash flow. In addition, you will often be required to share your monthly financial statements while the loan is being paid back. Other types of loans that may work for an already established business include equipment loans, business lines of credit, and merchant cash advance.

Private Hard Money Lenders

A private hard money Texas Commercial Loan is asset-based. They do not consider your credit score or creditworthiness to the same degree that a conventional lender does. You will need to share your business plan and exit strategy. Payments are typically interest only until the project is complete and has been sold or the borrower has rehabbed a property and is now obtaining a traditional loan based on the after-repair value (ARV). Businesses can also obtain hard money loans as long as they have a form of collateral. These loans are typically 75 percent loan-to-value, though this figure varies. Unless you know someone in the world of private lending, it’s often easier to access the private lender through a broker that works with hundreds and knows what type of business or property each investor is interested in.

A private hard money loan is a short-term loan with terms that are usually in the range of three months to two years. These types of loans provide access to quick capital.

At Level 4 Funding, we pride ourselves in understanding your needs and saying yes when banks have said no. Call us to see if we have the Texas Commercial Loan that you need for your next project.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Setabay Private Hard Money Lender

Monday, September 11, 2017

Who Uses Hard Money Loans for Commercial Lending

Numerous borrowers use hard money loans for a variety of reasons. From real estate investors looking for Texas Commercial Lending options to home buyers and businesses, there is usually a private hard money lender that can fund your next project or purchase.

Loans for Small Businesses and the Self-Employed

Texas Commercial Lending from a private hard money lender is easier to obtain and provides fast capital when businesses are in need.

What you can do to help your Private Hard Money Texas Commercial Loan Application get Approved

You may be turning to a private hard money lender for needed capital for a business loan, a real estate investment, or the purchase of a new home. Whatever the reason, there are a few tips to consider that may just help you get the Texas Commercial Loan you are seeking.

Documentation for Texas Commercial Loans

Many contractors and real estate investors turn to private hard money lenders for Texas Commercial Loans.

The Good and Bad of Credit Unions for Texas Commercial Loans

If you’re looking into getting a Texas Commercial Loan from a credit union but uncertain if you would qualify, know that times have changed. All credit unions are not “members only” anymore; in fact, several are open to the public.

A Credit Union versus a Private Hard Money Lender

A private hard money lender offers quick capital without the need for 700 plus credit scores.

The Present Housing Market and Commercial Lending

The housing market has definitely made a recovery from the lows of the Great Recession. Here are the markets to avoid and to embrace and the current Texas Commercial Lending trends.

Housing Markets and Texas Commercial Lending for First-Time Texas Commercial Real Estate Investors

A private hard money lender can be your entrance into the single-family home market.

The Current State of Texas Commercial Real Estate Investments and Commercial Lending

Commercial investment sales are down from the historic highs of last year due, in part, to tightening of conventional commercial lending. Alternative lenders are stepping in to fill the gap.

Who Uses Private Hard Money Lenders

Private hard money lenders are stepping in to fill the gap that the current conventional lending institutions are creating.

Real Estate Financing and Texas Commercial Loan Options

Obtaining that first Texas Commercial Loan is one of the major stumbling blocks that keeps want-to-be real estate investors from turning their dream into a reality. There are options and one may be just the right one for your needs.

Private Hard Money Lending

A private hard money lender provides asset-based Texas Commercial Loans . Credit scores are, typically, not as important to funding as is the collateral.

Qualifying for a Commercial Loan

Traditional lenders have tightened up their lending standards since the subprime mortgage crisis. Find out how to qualify for a Texas Commercial Loan and what options are available.

Private Hard Money Lenders

A private hard money loan is a short-term loan with terms that are usually in the range of three months to two years. These types of loans provide access to quick capital.

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