Category Archives: Property and Real Estate

About Hard Money Lenders

Many novice investors are curious about hard money lenders. There are many questions that arise like Who are they? What is that? How do I get it? Was this helpful? Let me share with you some basic principles about hard money lenders. First, let’s determine what the term “hard money” means. When money is discussed between investors, it is considered “soft” or “hard”.

Usually soft money is easier to qualify for and flexible requirements. Hard money, on the other hand, is just the opposite. That’s much tighter. Not that it’s more difficult to get, but the requirements are very specific and far more stringent. They must, because most of the hard money comes from private individuals with lots of money in hand. This is why hard money is also referred to as “personal money”. The money is used for investment purposes coming from people, just like you and me, not a typical lending institution. So their first priority is protecting their investment capital.

It is a good idea to know what the requirements are when dealing with hard money lending so you can find one that suits your needs. Usually they will only lend you up to 70% of the value of a decent home in repaired conditions. So if you find a house worth $ 45,000 in such conditions, and need $ 20,000 in repair work, and after repairing the current fair market value is worth $ 100,000, then they can usually lend you up to $ 70,000.

Another thing you will encounter is high interest rates. Interest rates vary from 12% – 20% every year and the period can last for 6 months to several years. This rate varies depending on your credit score and experience. In most cases, there will be closing costs or fees for using hard money. Hard money lenders will usually charge from 2-10 points. One point is equal to one percent of the mortgage amount. So charging 1 point with a $ 100,000 loan is $ 1000. These are all important things to consider when choosing a hard money lender.

Many hard money lenders today will also ask you to fill out credit applications that may require you a tax return, the latest payment deductions, and bank statements. Once again, it’s all about protecting their assets. However, some like the old fashion way where they only care about the deal so they drive or see the property physically.

Finance for Property

There are many conditions where you have to look for property finance quickly. This might be your first home purchase or investment property, or maybe you have found unique opportunities to expand your portfolio, but you must act quickly. Although there are many major lenders who can provide property financing, in many cases the approval time is long and the opportunity to make a purchase may be lost when the finances are agreed.

I will make two alternative suggestions for you to get property financing fast. In general, this advanced option of fast property financing is more suitable for experienced property investors who have additional securities and have bought and sold property in the past.

Choosing Boutique Lenders – A boutique lender is the right choice for getting fast property financing. Boutique lenders are generally flexible enough to tailor solutions to your exact needs and they have a very quick turnaround time to start your project. Because you deal with lenders directly, rather than through a broker, you will have direct access to ask questions and you will cut additional administration. Finding a good boutique lender can be a challenge, so it’s best to ask your coworkers and mentors to recommend someone. It also pays off to choose boutique lenders who have extensive experience in development funding and who know your area well.

Short-term Funding or Bridging Finance – Short-term funding may be a good choice for getting fast property financing. In such circumstances, your short-term finances will act like a temporary loan, allowing you to get funds quickly and take advantage of the opportunities that exist. You can then refinance with the main lender later, when time is no longer an urgent issue. Short-term financing options are usually offered by boutique lenders that are flexible and can provide quick turnaround. The amount usually ranges from $ 10,000 to $ 2 million.

How to Buy Luxury Real Estate

Like buying a house in general, there are a number of things to think about and consider before putting money on luxury property. Luxury real estate is usually a house or property that is in the upper class and outside the other average options available in the market.

Some luxury properties may come with very large houses, lots of land around it, indoor or outdoor swimming pools, or access to private land on the beach or other open areas. Whatever your plans for this space, you will certainly have enough room to grow, roam, and live in person.

If you see a luxury property in a certain location, see if there are foreclosures in the vicinity. The downturn in the housing market has hit many people, and you might find foreclosed homes that will be a better deal than other luxury real estate properties.

Doing research on the local housing market that you want to buy property for is a good way to determine what is the best you can get from real estate. High levels of foreclosure in some locations can depress the value of nearby home properties, so make sure you need to sell luxury properties or maintain them.

Another tip before buying is to ensure profitable interest rates. Usually a good interest rate is below 4.2% depending on where you live and the state of the local housing market.

If you are considering buying a large plot of land and building your own customized luxury home, look at real estate outside the main metropolitan area and consult with an architect who knows the estimated details of construction costs. Building on the boundaries of major metropolitan areas may seem like a good idea, but building away from cities will give you greater freedom to build your dream home in addition to being cheaper.

Luxury property and real estate can be exaggerated in advertisements and real estate agent descriptions, so be sure to see for yourself whether the property that you think you really buy is what you want.