Setabay Private Hard Money Lender

Monday, December 10, 2018

THE REAL DEAL ON ARIZONA HARD MONEY LOANS

Simply put, a hard money loan is a loan back by the value of the property versus the credit and income of the borrower. The property itself is used as protection against default by the borrower.

Arizona Hard Money Lenders are private individuals that see value in potentially risky ventures that traditional lenders are not willing to risk. These loans are a financing tool that every real estate investor should keep in mind.

Arizona Hard Money Loans have fast loan approvals and funding. Perfect credit scores and income history are not necessary to gain funding on Arizona Hard Money Loans. While conventional bank lenders are known to for their rigid rules and regulations, Arizona Hard Money Lenders are allowed to be more flexible in their loan terms because they don’t have to follow federal guidelines as banks are required to do.

HOW TO GET AN ARIZONA HARD MONEY LOAN

1. Research Arizona Hard Money Lenders in your area. Make sure the lender has a legitimate web site—be sure they will not just collect your information and pass it on to a third-party. Check that the lender doesn’t have any pending or former law suits from investors. Find out what types of projects the lender has financed previously. You want to make sure this lender will be interested in the type of project you are proposing.

2. Evaluate your time frame—Arizona Hard Money Lenders are able to generate funds within two weeks or less. Do you need funding immediately? A hard money lender will make that happen; while a traditional lender can take months to grant the loan.

3. Apply for the loan— Unlike a conventional loan—in a hard money loan you are financed on the collateral value of the property instead of your FICO score. That will require you to present certain documents—such as a detailed budget for construction, repairs and renovations. You will also need to prove the value of the neighborhood and the property—comps are sale prices of the neighboring homes and the lender will need to see those, as well.

4. Check for additional fees—Review the loan terms. Arizona Hard Money Lenders are not subjected to the regulations that banks are, so be sure you are protected legally. Be clear on all fees—if your lender does not disclose any fees that will be included in the loan that is a red flag. Make sure you are given a detailed repayment schedule—this will include how much interest will be accrued and how much of your payment will go towards the interest.

After you choose a Hard Money Lender and are approved it is imperative you move swiftly on your investment.

During the project you will only be required to pay interest. The balance of the loan is due at the end of the loan term. Arizona Hard Money Lenders do not typically impose prepayment penalties. The faster you complete your project—the quicker you can pay off your loan. There are so many benefits to a hard money loan—quick financing, flexible loan terms and asset based backing instead of personal credit history.

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.

ARIZONA SPEC LOAN FINANCING

An ARIZONA SPEC LOAN is the term used for a loan on a speculative property. It falls under the umbrella of construction loans.

Investors require funding when it comes to speculative property. It is speculative because the property has not been built yet. The builder and investor are speculating they will sell the property and make a profit.

Typically, banks do not lend for speculation properties. Unlike banks, Arizona Hard Money Lenders are eager to fund such deals. Hard money lender’s loan periods are shorter and they are able to adjust to market conditions therefore gradually developing their loans to match market trends. Today’s market is low inventory and high demand. If your speculative project fits the requirements it is a perfect time to work with a hard money lender.

BENEFITS OF A HARD MONEY ARIZONA SPEC LOAN

Choosing a hard money loan has many benefits. The loan isn’t paid in full until the construction is complete. During construction you will only be required pay interest only. The balance of the loan is done at the end of construction or the loan term. Arizona Hard Money Lenders have more flexible terms. Although, it will be necessary to provide your lender with all the specifics of your project—they have much more flexibility in terms of loan terms and guidelines than a traditional bank loan does. The lender will work the loan terms around the needs of the project.

Not only will a hard money lender be more flexible with the lending terms on a ARIZONA SPEC LOAN; they are more flexible with approval than traditional loans. Because a hard money loan is backed by assets, a borrower’s credit is not as important. While traditional lenders base approval on a borrower’s credit score and monthly income— a hard money lender bases the approval on the borrower’s hard assets. If the borrower defaults on the loan the lender will foreclose on the property.

There are some things investors must know when choosing to be involved in spec home financing.

Building on speculation requires that the investor has strong understanding of the local housing market. The spec home must sell after construction and the lender must feel confident about this before proceeding with approval. Some factors the investor must have thorough knowledge are:

1. The local job market

2. Housing prices in the area

3. Home absorption rate

4. Surrounding infrastructures and amenities

Spec houses are never guaranteed to sell. However, to receive funding the lender must be confident that the house has a high probability of being sold. They will not risk building a home that doesn’t meet the needs of the local buyers. The key is to be sure to make the home generic enough that it appeals to as many buyers as possible.

WHAT IS A ARIZONA FIX AND FLIP LOAN

If you’ve watched shows like Fixer Upper or Flip or Flop on HGTV you’ll see why house flipping is all the rage. Watch just a few episodes and you will see how flipping houses can turn into a formidable profit.

An Arizona FIX AND FLIP LOAN is a type of loan where the borrower receives funds secured by the value of the property. These loans do not follow traditional financing. Financing is collateralized by the foreclosure of the property for which the loan is being made.

There are two components to fix and flips—literally to fix and to flip. An investor purchases distressed property below market value. Then, the property is rehabbed by making repairs and improvements— therefore increasing the value of the property. After renovation the goal is to sell it for a profit in a reasonably short time.

HOW ARIZONA FIX AND FLIP LOANS WORK

Every fix and flip starts with finding the property. Once you find the property you must figure out how to finance your project. There are four parts of your house flip that you will need to finance:

1. The purchase price of the property

2. The holding cost of the property

3. Materials for the rehab (and labor if you are not doing this alone)

4. Closing costs

The first thing you need to know is that you won’t be getting a traditional bank loan. The distressed properties do not meet FHA guideline and therefore do not qualify for traditional financing. So, very rarely are banks involved in Arizona FIX AND FLIP LOANs. Private money lenders generally finance Arizona FIX AND FLIP LOANs. The interest rate is higher than a conventional property loans due to the risks involved in financing the renovation and the expeditious turn around time.

WHAT TO DO BEFORE APPLYING FOR THE ARIZONA FIX AND FLIP LOAN

1. Create a business plan— this will include the address of the property, comps (sale prices for comparable homes in the same general area), financial projections, an appraiser’s current valuation of the property and a back-up plan just in case the renovation doesn’t go according to plan).

2. Estimate renovation costs— many flippers don’t borrow enough money—and that can easily lead straight to disaster. To make sure this doesn’t happen create a scope of work. This is a detailed outline of any repairs needed, the cost of the repairs and the timeline. This is where you will need an appraiser and contractor’s help. Both will work together to give you a quote and a timeline. It is imperative that you account for unknown issues that will arise. The scope of work will contain two very important numbers—the loan-to-value (LTV) and the after-repair-value (ARV). The LTV is a comparison of your loan size to the value of the property; an ARV is the estimate of the property after renovations are complete.

FINDING THE HARD MONEY LENDER

There are numerous options for finding funding on a Arizona FIX AND FLIP LOAN. Some possibilities are personal loans, lines of credit, using your retirement or a silent partner. However, most real estate investors know a hard money lender is the easiest and most straight forward lender. Arizona Hard Money Loans are from private investors or individuals. There are lower qualification requirements and both approval and funding happens in less than two weeks. These lenders are invested in your success. This is an investment for them as much as it is for the borrower.

Many people are finding success through Arizona FIX AND FLIP LOANs. It doesn’t require the borrower to have great credit or even a down payment. It involves strategy and determination—along with a disciplined work ethic.

Flipping houses can be a full or part-time job. The good thing about flipping houses is you don’t need a ton of start-up money or a great FICO score. It is a gratifying experience and your wallet will thank you for the experience.

Friday, December 7, 2018

3 Traits of Successful Investors Getting an Arizona Hard Money Loans

Receiving your Arizona Hard Money Loans is only half the battle. You have to be a savvy investor to make the right decisions to maximize your return on investment. Here are 3 traits successful investors share.

Arizona Hard money loans can be the first step to becoming a successful investor because, of course, you need cash! But if you don’t know what to do with that cash, you can run into some roadblocks that will keep you from reaching your investment potential. Here are 3 traits of successful investors that I’ve noticed in my years of working in Arizona hard money loans.

A Competitive Nature

If you’re taking a Arizona Hard Money Loan to purchase a fix and flip property, you’re going to need to go for it quickly and with gusto! If you aren’t ready to bid against other investors, do what it takes to get the right property, and market that flipped property to sell, then your investment won’t bring in as much money as the next guy. A competitive nature will push you to do more, and more importantly, make more!

Obsessive Organization

You’re going to need to build up quite the portfolio of investment information and if you aren’t well organized, you can kiss that information goodbye! Your investment network will include some realtors, other investors, hard money lenders, and contractors, and I will tell you now that they will not want to work with someone who is unorganized. It will save you money and ensure your network knows you’re someone they can rely on.

They Have a Level Head, Even in Crisis

The fact is that not all investments go according to plan, but the best way to make sure it fails is to lose your cool in tense situations. If you panic chances are you’re going to make mistakes and the investment may lose its potential for return. Knowing how to deal with issues when they arise, and doing so with a calm and collected attitude, will keep your investments from hitting the point of no return. Prepare for issues and handle them accordingly if, or when, they arise.

I will share more traits of successful people in the future, but these three are the ones I’ve seen the most in my clients of Arizona hard money loans. Phoenix is chalk full of investors, but success is determined by your ability to make the most of opportunity and not allow problems to throw you off track.

Give us a call at Setabay LLC if you want to discover how you can make quicker, bigger investments by having fast capital.

3 Reasons to Talk to a Arizona Hard Money Lender Today

Arizona Hard money lenders can sometime get a bad rap, but for the right type of investment, they’re just what the doctor ordered. Find out why!

I’m sure you’re familiar with the phrase, “You can’t believe everything you hear.” Have you ever had a friend tell you a movie is terrible only to see it months later, enjoy it, and wish you had seen it sooner? We’re trained to listen to rumors and information from people we know, but what if that information isn’t true? The same can be said for hard money lenders. In Phoenix, hard money lending is a staple for investors and I’m going to tell you three reasons why you should speak with a Arizona Hard Money Lender today!

Your Investment is Our Investment

When you’re applying for a loan with a Arizona hard money lender, we’re looking at the purchase with you. We want you to make a sound investment for a few reasons:

● Your success is our success - We don’t make our money back easily if you aren’t successful with your purchase using the hard money loan.

● Our loan depends on the value of your purchase - We base our loan amounts on the potential return.

● Collateral is everything - Because of our loan qualifications, your collateral is what speaks to your ability to pay back the loan.

We’ll Meet You More than Halfway

One of the best parts about a Arizona Hard Money Lender is that they will be flexible with you. Our loan qualification process isn’t set in stone so there’s some wiggle room for us to make sure you fit into the right loan and repayment schedule. We want to work with you as an individual, something traditional banks can’t always offer.

We Don’t Like to Say No

As stated above, your investment is our investment. That means we’re going to work to get you approved for your hard money loan. We don’t make money by sitting on it so making loans is our business. That means you have a higher chance of getting approved with us!

I know that taking out large loans can be daunting, but that’s why Arizona hard money lenders in Phoenix, like us, make sure to give all of the facts and figures to our clients so they can rest assured that they’re making the best investment choices. Give us a call and speak with one of our Arizona hard money lenders so you can realize your investment potential.

Tips to Be Successful in Fix and Flip Investment Property

Here are some tips to help you get started in the fix and flip arena. Keep these things in mind as you search for your first property.

There’s a learning curve for everything and Fix and Flip Investment in Arizona is no different. From finding the right home to selling the home after you’ve fixed it up, there are helpful tips that can keep you from some of the issues that first-time flippers run into.

Know Your Money

It’s easy to jump into a Fix and Flip Investment Property in Arizona and find yourself drowning in the expenses before you can even get it back on the market. What you need to do is have a good idea of what you can spend on the home so that you’re not overextending your capital. If you buy a home that costs too much you aren’t going to have enough to complete the renovations. Speaking with a Arizona Hard Money Lender can help you plan for just that and keep you from drowning in the costs of renovating. Don’t spend more than you can afford!

Act Fast

If you see the perfect property that has the potential for a fix and flip investment in Arizona and is in your price range where you’ll still have the money to renovate and cover the monthly expenses while you’re fix and flip, you need to make your move. Cheaper properties don’t last long and chances are you’ll be bidding against other cash offers. Know your max off you can make and still have the cash for renovations and the potential for your profit, and then make your offer quickly.

Look for Homes that Haven’t Sold

The easiest way to find a home that may accept a lower cash offer that will allow you to make the biggest profit is to look at the days it’s been listed. The longer it’s been there, the more likely they are to accept a lower cash offer. Fix and flip investments have to be based on what’s out there so that may be an older home that has no curb appeal, but that’s where you come in! Hard money lenders make it possible for you to make that quick, cash offer by giving you the capital up front and without the red tape of a traditional bank loan.

Once you start your fix and flip investment in Arizona you’ll have a good idea of what this process looks like and what you can expect as far as turn around and actually selling the home. But no matter how many times you’ve fixed and flipped, keep these tips in mind!