A fantastic buy on a fix and flip property located in a very good subdivision suddenly shows up — seems so good that it's hard to believe. Everybody knows that knowledgeable professional flippers, along the lines of Tarek and Christina El Moussa who star in HGTV's reality flipping program, Fix or Flop, are able to make a typical profit margin of forty to fifty thousand dollars in their rehab business. It's fair to say their past experiences rehabbing, knowledge of hard money loans, familiarity with the market, and auction talents have had an important part in their success. However, you are assured that your first class rehab and renovation skills can help you do a superb job for this project — what's more, you have already lined up one of the finest general contractors in the area to take on the project.

But where can you obtain the necessary financing for home flipping? For those who meet with a regular lender, much like a bank for funding, it in all likelihood will take, as a minimum, 4-8 weeks for your approval to come through and your money to be furnished. So if you will be hoping for a fast closing, you need to understand or know that this may set you back by weeks, making you lose out on the sale.

With banks establishing more challenging loan requirements in the past few years, it is now more challenging for a self-employed person to obtain a home loan, especially if his credit situation is not optimal. So does that leave you with no option, but to drop your aspiration to venture into rehabbing? Definitely not, given that you also have the hard money loan alternative.

A hard money home loan in can provide what is deemed crucial to most real estate sales — a quick closing of just a 2-3 weeks and sometimes less. Besides that, hard money lenders are able to do lending up to 70% LTV of the property value, as determined by a certified third-party evaluator. At first, hard money real estate loans, with starting lending rates of 10%, could be seen as more pricey than bank financing. But the term lengths for these loans are quite short, which makes the interest rate far less important. As it pertains to short-term loans of one or two years or even less, you should think about them just like you would other expenses for your project. Right after you rehab and sell off the house, recuperating this expense is the same as recovering the money you spent for home appliances you placed into the house.

Apart from this, hard money mortgages are not difficult to qualify for, whether or not you have a bad credit rating. The borrower's credit score isn't the exclusive deciding factor for hard money lenders — in addition, they consider the property, its market value, where it is located, and its capacity to earn back their investment if everything does not go as intended. Additional criteria that influence an applicant's eligibility for a hard money real estate loan include how much money he can put towards a down payment, his past experience as a real estate investor, and price of comparable, recently sold properties in the vicinity.

If you happen to have stumbled upon a really great real estate opportunity with a significant prospect of returns, you've also discovered a hard money lender in who's willing to provide funding for your flipping project. Fill out the form on this page or give us a call and let's discuss your project.