Third Party Loans Pave The Way
The TV show “Shark Tank” will teach one a lot about bridge loans or hard money as it is called. Hard money is a loan obtained from a third party who is not necessarily a lender like a bank or a mortgage broker. In small towns there are always a handful of locals who have enough capital sitting around to help a cousin or friend of a friend buy their first home. Often a home that is not lendable like a single-wide or one that needs considerable fixing up. On a larger scale a bridge loan would be a more formal financial arrangement for a commercial venture. For example, a plumbing contractor wants to fix up bank owned properties he has purchased for pennies on the dollar. The lending party will provide that cash to get the job started knowing the contractor will be able to pay it back once the remodeling is complete and the home has been rented or resold. Either way hard money is a great way to generate operating capital to get a business service started or bail out an existing construction job.
In these tough economic times, commercial real estate developers are often the first to falter financially. Take a large condominium project that started during the boom as an example. The first tower was completed and sold out quickly, so the second tower was started. When the bottom began to fall out, it is likely several of the first tower investors started to fall back on their note payments. Then construction costs soared and the 2nd tower project stalled. This is the perfect time for that developer to turn to a real estate capital lender like Madison Realty Capital. The developer is not going to qualify for a bail out from a bank or your typical mortgage broker so a bridge loan provider is the only option. There are not downsides since there are no other options at this juncture. The interest rate may be high and the loan term may be short, but if the developer offers an equity stake in his condominium venture, that bridge loan can turn into a win-win.
At some point the market will turn around, the bridge loan or hard money will have helped you through the hard times or the start-up. Now the future will be newly paved without any further financial headaches. Ideally, the money borrowed will be paid back and any further interim financing required will be less of a mystery. Indeed future hard money loans would be available at better interest rates with a proven track record of successfully completed projects.
Using Hard Money To Fund A Construction Project
You are ready to start construction, but the loan process is slowing you down. You should consider obtaining a hard money loan to get going on your project today. Hard money loans can be obtained quickly and with little upfront cost to you. What are hard money loans and how can I obtain one?
Hard money loans are a type of real estate loan that is provided by private investors, through brokers. The collateral for this type of loan is the value of the property. In the case of a construction loan it is the improved value of the property. In order to provide security to the lender, the hard money loan will have higher interest rates than a conventional loan, and will be limited to around 65% of the improved value of the property. The lender will also only lend from the first position, so that in the event of a foreclosure, they are the first party to recover their investment.
Hard money loans are short term loans, so you need to have an exit strategy before obtaining one of these loans, such as a plan to sell the property when completed or to refinance the property through traditional institutions.
Although the loan is limited to 65% of the improved value of the property, construction loans will generally cover all of the costs of construction, assuming that costs for construction are less than the value of the property upon completion.
If you have a business that is growing at a rapid pace and you are ready to expand by constructing a new building or updating your current building. Obtaining enough capital to obtain traditional financing for this construction can take a while. In this case, it would be worthwhile to pay a higher interest rate for a hard money loan, and be able to start construction within days.
Hard money lenders are available all over the country; a web search will turn up many lenders available in your area. Several websites will give you access to multiple lenders. Before approaching a lender, have your plan in place. Have complete details on all of the costs associated with the construction project, an appraisal of the completed property, as well as details on your exit strategy. Provide this information to the lender(s), and you should receive approval within a day or two, and be able to close on the deal within a week.
What Is Hard Money Lending?
A common situation that is occurring within the real estate industry itself is hard money lending. This is when a loan is made for the purchase of real estate, where the property is in the areas of residential or commercial and it does not conform to the traditional bank lending standards. In many cases this kind of lending could involve real estate where the owner is behind on the mortgage payments, there is a bankruptcy or a foreclosure has taken place. These kinds loans are used where traditional bank loans are simply do not exist. This is why hard money lending has many distinct advantages that can benefit property owners such as:
You could avoid bankruptcy: There are many people who purchase real estate and they get in over their heads, where they simply can not afford the property. In many cases these same people have high amounts of debt which makes the prospect of bankruptcy seem like a realistic possibility. When you receive a hard money loan you can be able to use what is known as a deflated rate, this allows you to pay more of the principal back on property. As this continues on a regular basis you will be able to own the property quicker and be able to pay off your debt faster compared to other forms of lending. This will help improve your credit rating by showing that you are making your payments consistently and it will ultimately allow you to avoid bankruptcy.
You can be able to purchase real estate easier: For many people who are investing in commercial properties or even apartment buildings hard money lending is ideal. There are times when you are trying to purchase a piece of real estate where the lending standards are very tight and many investors are afraid to invest. One way to be able to overcome this dilemma is to receive a hard money loan. In general hard money lenders do not rely heavily on your credit report like many traditional lenders; instead they are concerned about if the investment makes sound financial sense. Where, the property is generating enough income to be economically viable during both good as well as bad times.
Clearly hard money lending is a great way to be able to receive the kind of financing that you are looking for. Above are just two of the distinct benefits that hard money lending has to offer. It is through understanding these different benefits that will help you determine if receiving a hard money loan is right for you.
How To Close A Loan In 3 Days, By HMB
Ok, let me preface this by saying that
we don’t like to do this all the time
and we can’t possibly do this with every
loan but…
We can easily close a loan in 3 days
on the right deal with a prepared
borrower.
Here is how it went down:
Jason got a call late Thursday before
Thanksgiving from a borrower we have
never worked with before saying he
absolutely had to close his loan on Tuesday.
And mind you this is the Tuesday before
we all take off for a nice holiday break.
It just so happened the borrower was very
organized, professional and the deal was a
strong one.
Thursday:
-Loan app, contractor bid, sales contract, etc
turned in to Jason
-Appraisal/BPO fee paid
-We pull credit and comps
-BPO and title ordered (RUSH)
Friday:
-Jason inspects property (we always do)
-A couple other documents turned in
Monday:
-BPO and title come in (both clean)
-Property insurance comes in
-Loan documents prepared by our attorney
Tuesday:
-Wire sent from us to title company
-Borrower signs documents
-We all break for Thanksgiving
It was a great loan for a solid borrower
done in a short amount of time. Of course,
they aren’t all that quick and easy but it sure
would be nice if they were.
If you have a strong loan that needs to close quickly,
don’t hesitate to apply. We have some more funds
to lend out in the next couple weeks before the holidays.
Apply here now:
http://hardmoneybankers.com/loan-application
Happy Investing! (get one more deal in this year )
Hard Money Bankers, LLC was established in 2007 by 3 real estate professionals. Our goal is to supply easy, flexible, and quick funding to real estate investors. Also, our real estate investing blog, HMBCribs.com is a great resource for all investors.
Hard Money Bankers Open Office In Cincinnati
Adding to the headquarters in Baltimore, Maryland Hard Money Bankers, LLC announces the opening of a new office in Cincinnati, Ohio. Matt Adams, a successful real estate investor and entrepreneur has been brought on to manage the new office.
Hard Money Bankers, LLC, founded in 2007, is a private real estate lending company that lends private money to real estate investors when traditional loans are not the right fit.
The company’s dedication to its customers can be seen through friendly service, attention to detail, and consideration of their borrowers. The new office will be no different. Mr. Adams will continue to provide excellent service to all current and potential customers.
As well as providing hard money to borrowers, Hard Money Bankers aims to educate real estate investors as well. A new interactive web site, dedicated to educating and informing real estate investors was launched earlier this month and has received much acclaim.
The new office in Cincinnati, Ohio will also work with brokers on hard money deals to help them place their Borrowers into the right hard money loan with Hard Money Bankers.
Hard Money Bankers was founded by three real estate minded individuals with varying backgrounds. Jeff Shiller, a real estate attorney, has been involved with hard money lending for nearly a decade. Mr. Shiller has gained notoriety though various avenues in the real estate industry including owning a title company and counseling real estate investors. Chris Haddon began his real estate career as a loan officer for Sun Trust Mortgage which led him to co-found a successful real estate investment company. Jason Balin has held nearly every position in the real estate world. From real estate agent to mortgage broker to real estate investor, Mr. Balin has excelled in numerous successful real estate ventures.
Hard Money Bankers anticipates a large response to the new office as Cincinnati, Ohio is a great market for real estate investing.
Visit http://www.hardmoneybankers.com or call (800) 883-8290 for more information.
Hard Money Bankers Announces Largest Quarter In Company History
Hard Money Bankers, LLC announces today that its first quarter numbers are the best in company history in terms of both number of loans closed and total volume. The company has seen steady growth since being founded and sees more growth on the horizon.
The real estate market has seen its ups and downs in recent years and many real estate lenders have been hit hard with the drop in the market. Hard Money Bankers has been able to avoid such volatility and continues to be a strong force in real estate investment lending by continuing to work with well qualified, experienced real estate investors.
Hard money lending in general has seen growth in the past few years despite the tightening of conventional loans. Loans from banks are typically credit based and with the recent credit crunch, even previously over-qualified borrowers have been denied loans. Most hard money lenders including Hard Money Bankers rely more on the equity in the project to determine loan worthiness.
Hard Money Banker’s borrowers are typically experienced real estate investors looking to rehabilitate and resell a property or obtain short term financing for other business ventures. Hard Money Bankers helps dozens of borrowers every month to obtain the financing they otherwise couldn’t get.
The growth that Hard Money Bankers has seen is not typical in the real estate lending world. Hard Money Bankers principal Jason Balin says the rapid growth is due to “working with the right borrowers, performing the proper due diligence, and only funding sensible deals”. Doing so not only keeps production up, but also limits loan defaults.
However, borrowers are not the only ones profiting from Hard Money Bankers successful lending practices. Hard Money Bankers has a stable of capital investors who earn returns on the mortgage notes they back. These investors have also seen profits rise as Hard Money Bankers continues to expand its loan portfolio.
For more information about Hard Money Bankers and hard money lending, please visit http://www.HardMoneyBankers.com.
A Different Approach To The Real Estate Business
Real Estate Investing is a tough business right now. While the business of buying and holding real estate as a long term investment remains a legitimate and viable strategy for wealth building, profit is no longer guaranteed as it once appeared to be.
With that in mind, the astute real estate investor will consider some specific real estate investment concepts to complement the “tried and true” strategy of long-term buy-and-hold investment houses:
* Virtual Real Estate Investing – the term “virtual real estate investing” has multiple meanings, including the use of the internet to buy and sell property, and the purchase and development of internet websites as a means of generating revenue. With an objective analysis, one can see the conceptual similarity between physical real estate and internet properties including entire websites and even individual pages controlled on larger sites like Facebook, Squidoo and Google Knol. Increasingly, real estate investors are seeing the clear opportunity presented by developing web “properties” into revenue generating assets much like physical rental properties. This trend is on the rise and will continue for the foreseeable future.
* Hard Money Lenders– when real estate investors need cash funding for their deals, they frequently turn to hard money lenders who provide the needed funding in exchange for payment of up-front points and high interest rates. But in many cases, the real winner is the hard money lender who profits from a high-interest loan secured by very low loan-to-value ratios. For this reason, many well-funded investors are turning to hard money lending as an alternative profit strategy. Since the down-side risk for the lender is mitigated by an asset with significantly higher value than the money being loaned, the risk to reward ratio clearly favors the hard money lender.
It’s a different world in the real estate investment business. It would be very, very simple to think that the foreclosure crisis has caused the door of opportunity to be slammed entirely shut. Yet that’s simply not the case. When one observes the state of the real estate market, it is undeniable that fundamentals matter more than ever. For example, the selection of the local real estate market is of greater importance than ever, considering the huge disparity that exists among the thousands of real estate markets across the United States. Additionally, the role of regulatory compliance is greater than ever given the activist nature of the current presidential administration.
Without a doubt, there are very major challenges in today’s real estate investing market. But with some persistence, determination and creativity, there is still plenty of opportunity.
A Different Approach To The Real Estate Business
Real Estate Investing is a tough business right now. While the business of buying and holding real estate as a long term investment remains a legitimate and viable strategy for wealth building, profit is no longer guaranteed as it once appeared to be.
With that in mind, the astute real estate investor will consider some specific real estate investment concepts to complement the “tried and true” strategy of long-term buy-and-hold investment houses:
* Virtual Real Estate Investing – the term “virtual real estate investing” has multiple meanings, including the use of the internet to buy and sell property, and the purchase and development of internet websites as a means of generating revenue. With an objective analysis, one can see the conceptual similarity between physical real estate and internet properties including entire websites and even individual pages controlled on larger sites like Facebook, Squidoo and Google Knol. Increasingly, real estate investors are seeing the clear opportunity presented by developing web “properties” into revenue generating assets much like physical rental properties. This trend is on the rise and will continue for the foreseeable future.
* Hard Money Lenders– when real estate investors need cash funding for their deals, they frequently turn to hard money lenders who provide the needed funding in exchange for payment of up-front points and high interest rates. But in many cases, the real winner is the hard money lender who profits from a high-interest loan secured by very low loan-to-value ratios. For this reason, many well-funded investors are turning to hard money lending as an alternative profit strategy. Since the down-side risk for the lender is mitigated by an asset with significantly higher value than the money being loaned, the risk to reward ratio clearly favors the hard money lender.
It’s a different world in the real estate investment business. It would be very, very simple to think that the foreclosure crisis has caused the door of opportunity to be slammed entirely shut. Yet that’s simply not the case. When one observes the state of the real estate market, it is undeniable that fundamentals matter more than ever. For example, the selection of the local real estate market is of greater importance than ever, considering the huge disparity that exists among the thousands of real estate markets across the United States. Additionally, the role of regulatory compliance is greater than ever given the activist nature of the current presidential administration.
Without a doubt, there are very major challenges in today’s real estate investing market. But with some persistence, determination and creativity, there is still plenty of opportunity.
A Different Approach To The Real Estate Business
Real Estate Investing is a tough business right now. While the business of buying and holding real estate as a long term investment remains a legitimate and viable strategy for wealth building, profit is no longer guaranteed as it once appeared to be.
With that in mind, the astute real estate investor will consider some specific real estate investment concepts to complement the “tried and true” strategy of long-term buy-and-hold investment houses:
* Virtual Real Estate Investing – the term “virtual real estate investing” has multiple meanings, including the use of the internet to buy and sell property, and the purchase and development of internet websites as a means of generating revenue. With an objective analysis, one can see the conceptual similarity between physical real estate and internet properties including entire websites and even individual pages controlled on larger sites like Facebook, Squidoo and Google Knol. Increasingly, real estate investors are seeing the clear opportunity presented by developing web “properties” into revenue generating assets much like physical rental properties. This trend is on the rise and will continue for the foreseeable future.
* Hard Money Lenders– when real estate investors need cash funding for their deals, they frequently turn to hard money lenders who provide the needed funding in exchange for payment of up-front points and high interest rates. But in many cases, the real winner is the hard money lender who profits from a high-interest loan secured by very low loan-to-value ratios. For this reason, many well-funded investors are turning to hard money lending as an alternative profit strategy. Since the down-side risk for the lender is mitigated by an asset with significantly higher value than the money being loaned, the risk to reward ratio clearly favors the hard money lender.
It’s a different world in the real estate investment business. It would be very, very simple to think that the foreclosure crisis has caused the door of opportunity to be slammed entirely shut. Yet that’s simply not the case. When one observes the state of the real estate market, it is undeniable that fundamentals matter more than ever. For example, the selection of the local real estate market is of greater importance than ever, considering the huge disparity that exists among the thousands of real estate markets across the United States. Additionally, the role of regulatory compliance is greater than ever given the activist nature of the current presidential administration.
Without a doubt, there are very major challenges in today’s real estate investing market. But with some persistence, determination and creativity, there is still plenty of opportunity.
A Different Approach To The Real Estate Business
Real Estate Investing is a tough business right now. While the business of buying and holding real estate as a long term investment remains a legitimate and viable strategy for wealth building, profit is no longer guaranteed as it once appeared to be.
With that in mind, the astute real estate investor will consider some specific real estate investment concepts to complement the “tried and true” strategy of long-term buy-and-hold investment houses:
* Virtual Real Estate Investing – the term “virtual real estate investing” has multiple meanings, including the use of the internet to buy and sell property, and the purchase and development of internet websites as a means of generating revenue. With an objective analysis, one can see the conceptual similarity between physical real estate and internet properties including entire websites and even individual pages controlled on larger sites like Facebook, Squidoo and Google Knol. Increasingly, real estate investors are seeing the clear opportunity presented by developing web “properties” into revenue generating assets much like physical rental properties. This trend is on the rise and will continue for the foreseeable future.
* Hard Money Lenders– when real estate investors need cash funding for their deals, they frequently turn to hard money lenders who provide the needed funding in exchange for payment of up-front points and high interest rates. But in many cases, the real winner is the hard money lender who profits from a high-interest loan secured by very low loan-to-value ratios. For this reason, many well-funded investors are turning to hard money lending as an alternative profit strategy. Since the down-side risk for the lender is mitigated by an asset with significantly higher value than the money being loaned, the risk to reward ratio clearly favors the hard money lender.
It’s a different world in the real estate investment business. It would be very, very simple to think that the foreclosure crisis has caused the door of opportunity to be slammed entirely shut. Yet that’s simply not the case. When one observes the state of the real estate market, it is undeniable that fundamentals matter more than ever. For example, the selection of the local real estate market is of greater importance than ever, considering the huge disparity that exists among the thousands of real estate markets across the United States. Additionally, the role of regulatory compliance is greater than ever given the activist nature of the current presidential administration.
Without a doubt, there are very major challenges in today’s real estate investing market. But with some persistence, determination and creativity, there is still plenty of opportunity.