Hard Money Loans in Bloomington
Imagine you've run across this really great deal on a fix and flip property in a great location, and you happen to be either a seasoned real estate investor or a newbie who really wants to try out flipping houses. Most folks know that expert professional flippers, such as Tarek and Christina El Moussa who do HGTV's reality flipping show, Fix or Flop, are able to make a typical profit margin of $40,000 to $50,000 when they rehab properties. Of course, you also realize that their great results can be credited to the fact that they are professionals, are proficient in hard money loans, they know the market really well and furthermore, they are good at working an auction to purchase their homes at a reasonable price. Still, your rehab and renovation knowledge isn't bad either — in any case, you have already identified an ideal general contractor to tackle the job.
But how do you get the necessary financing for home flipping? For those who go after an ordinary bank loan, you will need to wait around approximately 1-2 months until the money is authorized and your money is ready to go. Because most sellers prefer a fast closing, it may be best to begin looking for some other funding options.
With banks introducing more challenging loan standards in the past several years, it is more difficult for a self-employed individual to get a mortgage loan, especially when his credit situation is not flawless. So will a shortage of financing prevent you from sticking with your dream? By no means, because you could always use the Bloomington hard money loan approach to fund your flipping project.
Should you opt for a hard money home loan in Bloomington, you have access to what's probably most essential to real estate offers throughout the country — a quick closing of approximately 14 days. Additionally, loans can be made up to 70% loan-to-value of the "as is" home value, as calculated by a professional appraiser. With lending rates starting near 10%, hard money real estate loans may look, initially, to be more pricey as compared with traditional bank financing. But usually, the lending rate is not as useful a measure for these loans, given that they will never be long-term loans. As it pertains to short-term loans of a handful of years or even less, you should look at them much like you would other expenses for your project. Once you've turned the home and have made a good gain, you can recover this expense from the house — similar to recovering the money spent on the brand-new appliances for the kitchen that you have put in.
Aside from that, hard money mortgages are not hard to qualify for, regardless if you have very bad credit. Bloomington hard money lenders don't authorize a loan exclusively based on the borrower's credit score — rather they also evaluate the property, where it is located and what it is worth, and the property's capability to pay back the loan independent of the applicant. The amount that an individual can put down beforehand for the property, his past real estate experience, and price range of comparable properties in the same area are additional factors that go into determining a person's suitability for a hard money real estate loan.
Searching for a hard money lender in Bloomington to finance your fix and flip endeavor is not very hard, so long as the opportunity in front of you is promising and has a strong prospect for returns. Fill out the contact form on this page or call us to discuss the project you have in mind.
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