Hard Money Loans in Ridgeland
A fabulous deal on a fix and flip opportunity in an excellent neighborhood all of a sudden shows up — sounds so good that it's difficult to believe. Everyone knows that skilled professional flippers, like Tarek and Christina El Moussa from HGTV's reality flipping program, Fix or Flop, are able to make an average profit margin of $40,000 to $50,000 in their rehab business. Naturally, you also know that their success are due to the fact that they are industry experts, are well versed in hard money loans, they know the market quite well and furthermore, they know how to work a public auction for getting a reasonable price. Nevertheless, you are assured that your superb rehab and renovation skills will help you do a quality job on this house — additionally, you already have lined up one of the premier general contractors in the area to work on this project.
But how can you find the necessary financing for home flipping? For those who opt for a conventional loan from the bank, you will end up waiting approximately 4-8 weeks before the money is approved and your funding is ready to go. Thus if you happen to be hoping for a fast closing, it is important to understand that this may set you back by a few weeks, causing you to lose out on the house.
What's more, in case you have an unfavorable credit situation or do not receive a conventional income, it is normally tougher for you to be eligible for a bank loan, seeing the more stringent loan criteria banks have issued in recent times. So does that leave you with no option, but to abandon your ambition to venture into the fix and flip business? By no means, particularly when Ridgeland hard money loans enable you to realize great things in real estate.
A hard money home loan in Ridgeland provides what is perhaps most important to real estate investors — a very fast closing time period of as few as fourteen days. Besides that, hard money lenders will often consent to loans up to 70% LTV of the property or home's valuation, as calculated by a credentialed third-party evaluation. At first, hard money real estate loans, with starting interest rates of 10%, could be seen as higher priced than bank financing. But the time frames of these loans tend to be relatively short, making the rate much less significant. Short-term loans of a couple months to a few years are best understood in terms of cost of capital, the same as any other expenditure in connection with a project. Once you've sold the house and have made a successful profit, you're able to reclaim this expense from the home — similar to recovering the money spent on the brand-new appliances for the kitchen that you have put in.
Apart from this, hard money mortgages are not hard to qualify for, even when you have less-than-perfect credit. As an alternative for focusing only on the applicant's credit score or source of income, Ridgeland hard money lenders, who could be a privately owned company or an individual, approve a loan as a result of evaluating the property value, its salability, where it is located, and the possibility of recovering their capital in case of foreclosure. On top of that, if the individual can demonstrate past experience in comparable real estate projects, can put down cash for the down payment, and the cost of comparative homes in the area works to his benefit, he has a very good chance of being eligible for a hard money real estate loan.
So any time you come across a good and profitable flipping opportunity, be assured you'll have a hard money lender in Ridgeland, prepared to loan you the capital you may need. Submit the contact form or get in touch with us via phone to discuss the project you have in mind.
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