Hard Money Loans in Baltimore
Suppose you've come across this excellent bargain for a fix and flip property in a terrific location, and you're either a skilled real estate investor or a newbie who hopes to try out flipping houses. Professional residential home flippers, much like the young married couple on Flip or Flop, HGTV's reality flipping series, are capable of generating a profit of forty to fifty grand for most homes. It goes without saying their rehabbing experience, knowledge of hard money loans, familiarity with the market, and auction skills have had an important role in their results. On the other hand, you're convinced that your impressive rehab and remodeling talents will help you do a great job on this project — what's more, you already have arranged to have one of the most sought after building contractors in the area to work on the job.
But where do you find the necessary funding for flipping? When you opt for a traditional loan via a bank, you will have to wait around roughly 1-2 months until eventually the loan is authorized and your funding is ready to go. With the home owners wanting a fast closing, that doesn't appear like a great idea to you whatsoever.
With banks bringing in harder loan standards in the past several years, it has become tougher for a self-employed person to obtain a mortgage loan, particularly if his credit situation is not flawless. So does this mean you have no option, but to drop your ambition to venture into rehabbing? Most certainly not, seeing as you also have the Baltimore hard money loan alternative.
If you decide to apply for a hard money home loan in Baltimore, you will get what is possibly most important to real estate negotiations throughout the country — a very fast closing of about 14 days. Also, hard money lenders frequently agree to lending up to 70% LTV of the property or home's valuation, as established by a licensed third-party evaluation. A number of people regard hard money real estate loans to be higher in price than ordinary financing, considering lending rates for these loans commonly start at 10%. But the lengths of these loans tend to be rather short, which makes the interest rate less significant. Short-term loans of a couple of months to a handful of years are best approached in terms of cost of capital, very much like any other expense involved with a project. After you remodel and resell the house, recouping this expense is just like recuperating the money you spent for stainless steel appliances you placed into the house.
Furthermore, even individuals with low credit will be able to be eligible for a hard money mortgage. Baltimore hard money lenders do not approve a loan exclusively based on the applicant's credit score — instead they also analyze the property or home, its value and location, and the property's capacity to pay back the loan without the help of the person. Additional factors that affect a person's eligibility for a hard money real estate loan can include how much money he can put into a down payment, his prior experience being a real estate investor, and selling price of comparative, fairly recently sold homes in the area.
Locating a hard money lender in Baltimore to fund your flipping business is not difficult, so long as the opportunity that lies before you is promising and has a strong prospect for returns. Fill out the contact form or give us a call to talk about the property you have in mind.
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