Setabay Private Hard Money Lender

Sunday, March 31, 2019

Did You Know Owner Occupied Colorado Hard Money Loans Exist?

Colorado Hard Money Loans aren’t just for investors, owner occupied Colorado Hard Money Loans are here to help people buy the house of their dreams!

It’s common knowledge that Colorado Hard Money Loans are a great way for investors to get the funds for their investment projects. But did you know that owner occupied Colorado Hard Money Loans exist? It’s true!

There are two types of owner occupied Colorado Hard Money Loans. First, it can be used to purchase a home if traditional lending isn’t an option. Second, it can be used for investment purposes. Here’s the run down!

Owner Occupied Residential Properties

We know that purchasing a home through a traditional lender means tough requirements that not everybody can meet. What an owner occupied Colorado Hard Money Loan will do is enable a buyer to make a purchase with less than desirable credit until they can secure permanent funding.

Here are some reasons you may want to use an owner occupied Colorado Hard Money Loan for your primary residence:

Bad credit, recent foreclosure, or short employment history.

We can look beyond the traditional requirements to see the value you bring to the table as a buyer and we can create a loan tailored to your needs and have flexible repayment plans that can tide you over until you qualify for a traditional home loan.

Owner Occupied Investment Properties

Here’s another fact about owner occupied Colorado Hard Money Loans - you can use them to buy a multi-unit property, occupy one of the units, and rent out the rest! This is a great way to use real estate as an investment because not only will it provide you monthly income, but it’s an easy way to manage a property yourself and save costs on a property management company.

We here at Level 4 Funding have helped countless investors and buyers get the money to make the purchase they dream about. If you want to discuss how an owner occupied Colorado Hard Money Loan could work for your situation, give us a call today!

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.

THE BEST LOANS FOR HOUSE FLIPPING

Hard money loans and bank loans are the most common financing when it comes to real estate. But, what is the best loan for fix and flip projects?

Depending on how many properties you are working with at a particular time will navigate what type of financing is necessary.

Initially, new investors go to banks for financing. Typically, they don’t look toward hard money or private money. If you are going to do this you will need to look for local portfolio lenders. These are local banks that lend their own money. These are not big banks such as Wells Fargo and Bank of America that will approve and lend on a mortgage, but later on will sell these mortgages. These are smaller, local banks that will keep the mortgage in-house. The benefits of these loans are the low interest rate. These rates run between 4% to 6.5% at any given time.

However, there are major drawbacks to these small bank loans. Initially, you will be required to put more money down. Typically, an investor will be looking at upwards of 25% down. That’s a big chunk of change. That 25% does not include all the fees that will have to be paid, as well—that is additional money required. To add on to that, the investor is left to pay for all repairs to the house. These types of loans do not cover rehabbing.

So, if the house is $100,000—the investor puts down $25,000. Let’s say the repairs are $20,000—that’s $20,000 the investor has to come up with out of their pocket. So far, that is $45,000 that an investor will have to pay on a $100,000 house. That just doesn’t make sense.

WHERE ELSE CAN I GO TO GET A LOAN?

Arizona Hard Money Lenders are an avenue that investors can choose to borrow from. This option works great for many investors. The rates from a hard money lender will definitely be more than that of a bank. Rates can run anywhere from 7.99%-15%. The great thing about Arizona Hard Money Lenders is they will lend you more money. It is common to hear of a hard money lender financing 90% of the purchase price. On that same $100,000 house that the bank only lent $75,000—a hard money lender will lend $90,000. On top of that, a hard money lender will finance the repairs on the property, unlike a bank loan. Many lenders will lend 100% of the repair costs. How that works is you get what is called “draws,” As you make the repairs, inspectors will come out—the hard money lender will study the report and then authorize the cost of the repair. Arizona Hard Money Lenders will lend on more than one property at a time. Also, Arizona Hard Money Lenders want to know they can trust an investor. Once they see a relationship forming, interest rates and points usually become more manageable.

Traditional mortgages can be a great tool for financing, however when it comes to properties that will be quickly rehabbed and sold using a bank loan just doesn’t make financial sense.

To find a hard money lender in your geographic area simply conduct a Google search and allow Google to know your location.

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.

Denver is Booming and So Are Rentals

Rentals aren’t going out of style anytime soon. As an investor, rental properties are a fantastic way to bring in income. A Colorado rental property loan can make that a reality!

Denver is a hot spot for people who are looking to move to the mountains. Companies are buying up surrounding areas and bringing jobs, as well. All those people need places to live and renting is the way to go for some of them.

If you’re an investor, or want to become an investor, here are some tips for using your Colorado rental property loan to its maximum potential!

Know the Numbers

A rookie mistake that some rental investors make is to overestimate the value of their property. You may think that listing the property for a higher rent value means more monthly income, but that could lead to vacancies and price reductions that could hurt your bottom line. You want to know the area and the rent potential for your property like the back of your hand in order to be successful.

Understand Demographics

Renters are just as picky about the area they’re living in as buyers. They want to be close to shopping and transportation. For renters with families, they want to be close to good schools. Pick your properties strategically and in desirable neighborhoods to snag top dollar!

Don’t Over-Improve

Rentals are bound to need repairs and will have turnover so spending money on expensive upgrades isn’t the best use for your money. Instead hold onto that money for a new dishwasher if the old one breaks or to advertise for new tenants if you find yourself with a vacancy. Having a cash reserve is important for a rental investor and you definitely don’t want to put a large chunk of your Colorado rental property loan towards home upgrades.

If you’re choosing your properties strategically based on rental potential and location using your money for necessary upgrades rather than extra improvements, you’re on the right track to have great passive income from a rental property.

If you need a Colorado rental property loan in order to fund your property purchase, Level 4 Funding can do just that. Call us for more information today!

WHO SHOULD USE HARD MONEY?

People often associate hard money with being hard to get. However, the “hard” relates to the hard asset that is used to secure the loan.

The hard asset that is used to secure the loan is used in place of the borrower’s credit score or income—this is what traditional lenders use to determine a borrower’s eligibility. It use to be that homeowners would use these loans when they were denied conventional financing—that is not as much the case anymore. Typically, real estate investors use hard money—they can use them to fix and flip a single family home and resell the distressed property, small commercial bridge loans and construction.

WHEN TO USE AND NOT USE HARD MONEY

A lot of investors don’t use hard money with their first deal—mainly because they aren’t well-informed about the process, but also if they have friends or family that will finance them, they usually choose that path. After seeing that they can only do one deal at a time using friend’s or family’s money—and wanting to ramp up their investments they typically find a hard money lender. Many investors use Texas Hard Money Loans for distressed properties that don’t qualify for conventional financing. Many borrowers use hard money when they qualify for a conventional loan, but need to close in a short amount of time.

Texas Hard Money Loans are not ideal for a foreclosure bail out. Being in a foreclosure situation and using hard money to fix the issue at hand will probably result in getting the borrower in even deeper. Texas Hard Money Loans are not usually used for a property that a borrower is going to have as their primary residence. Most Arizona Hard Money Lenders don’t like to lend to these types of situations. And, with the higher interest rate and short terms a hard money loan isn’t ideal for a primary residence.

The rehab of property is the most ideal project for the use of hard money. Most lenders will lend a portion of both the purchase price and the construction. However, there are some lenders that do not want to deal with the hassle of the construction inspection or the uncertainty of a property. Each lender has their own niche and it is the borrower’s responsibility to research lenders to find out the best match for them.

Texas Hard Money Loansare not for everyone. However, there are many ideal situations in where hard money makes sense.

If the goal is to simply find a distressed property and fix and flip—there is no better lender than a hard money lender. This is what most lenders focus on. There are Arizona Hard Money Lenders that focus primarily on construction, small business loans and even residential bridge loans. However, if a borrower is looking for a 15-30 year mortgage, hard money is not ideal.

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.

Saturday, March 30, 2019

THE BASICS OF HARD MONEY LENDING

An investor can use hard money for businesses, construction and fixing and flipping homes. There are potential investors that are uncomfortable with using hard money because of the higher interest rates. However, understanding the benefits of hard money can easily rid a borrower of that concern.

Firstly, what is hard money? Hard money is money that an investor is lending in order for a borrower to proceed with their project—whether that be building a spec home or fix and flipping a residential property. A hard money lender is simply an investor who is looking to lend their money in order to make a profitable return. Arizona Hard Money Lenders rates typically range from about 2 points to 7 points and interest rates anywhere from 7% to 18%—this is a large range because each hard money lender has their own terms. Rarely, will a lender work on the high end of the interest rate—borrowers will more likely see 7%-12%.

The benefit of a hard money lender is the relationship an investor can build with their lender. It is common for a borrower to start out with more points and a higher interest rate and then watch the rates fall lower as the relationship becomes stronger. Once the lender sees the money return quicker they want to keep the business going with the investor because they have learned to trust that this investor will make money for them and make it quickly. This is a win-win situation for both the hard money lender and the real estate investor.

WHERE CAN I FIND ARIZONA HARD MONEY LENDERS?

It is not difficult to find a hard money lender. However, the ones a borrower will be best off with are smaller and more relaxed. These types of lenders will be easier to get a hold of, to answer your questions and all in all just easier to work with. There are both larger firms and smaller firms (or an individual). The larger firms will require more from a potential investor—they will do credit checks, require a minimum amount down. They will be harder to work with because they have a larger scale model they are working with and a large amount of borrowers they are filtering through their system. The smaller lenders don’t have to transmit borrowers through such a large model—they are more relationship based. Building a relationship is the goal for both investor and lender.

Yes, initially looking at points and interest rates it seems working with a hard money lender will be overly expensive.

Unlike a bank, working with a hard money lender will not only allow you to build a relationship— that trust you build will begin to pay off with lower interest rates and points. Once a relationship is built many investors simply can text their lender for an authorization on a project and the stronger the relationship, the more likely the answer will be yes— versus waiting up to 90 days for a bank to authorize an application. The benefits of working with a hard money lender far outweigh the slightly higher rates a borrower will pay in the start of this business relationship.

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.

What Makes a Good Investment Property?

Choosing an investment property is the first step to obtaining funds from a Colorado hard money lender. Here are some criteria you should be looking for to make a good selection.

Fixing and flipping is a great way to get cash as an investor. But how do you know which properties to choose? Many novice investors will make mistake when they choose their first properties and lose money on the project. Here are some things you’ll want to look for before applying to a Colorado hard money lender for your property!

Worst Property in the Best Neighborhood

As an investor you’ll want to know about the area you in which you want to make a purchase. It’s not a good idea to flip the best property in a neighborhood because the comparable properties in the area will bring your sale price down. You’ll want to choose a property that has good potential, but will be brought up in quality to match those around it to get competitive offers once it’s listed.

Don’t Go for the Money Pits

To go along with what we said above, you also don’t want to pick a property that’s going to be a money pit. You want it to be able to bring it up to the quality of its surrounding homes, but if that’s going to take far more money than you have, it’s going to dig you into a hole that can be hard to crawl out of. It can be easy to get sucked into a property that has ‘good bones’ and has the potential to be great, but if it’s not fitting into your budget then move along to the next one!

Unique Can Mean Harder to Sell

Another appeal to some investors is a unique property, meaning it’s different from the homes around it. Unique can be beneficial to a certain extent, but it can also deter buyers. Unique homes can cater to a certain audience and make it harder to sell. You’ll want a home that feels livable and appeals to the masses.

Once you’ve selected your investment property it’s time to put together your pitch for your Colorado hard money lender. That will include information like your rehab plans and finances for the remodel.

When you pitch your plan to a Colorado hard money lender you’ll be more likely to be approved if you’ve considered things like the area (schools, shopping, etc.) and the comparable homes in the neighborhood. The more prepared you are to present the information, the more sound your investment looks to your lender.