Hard Money Loans in El Dorado
There's this amazing opportunity to fix and flip this wonderful out of date condo in a very good part of town and it seems a lot like the deal you've been eagerly waiting on for quite a while. You've heard that competent house flippers, such as the couple on HGTV's Flip or Flop, enjoy a remarkable average profit of around $40,000 – $50,000. No need to explain that their past experiences rehabbing, understanding of hard money loans, familiarity with the market, and auction skills have been large factors to their success. That said, you have also been brushing up your rehab and remodeling knowledge, have got a licensed contractor ready for the project and are confident that you can do a stellar job for this property.
But financing can be a separate problem entirely. If you approach a common lender, such as a bank for a loan, it can take, at the very least, four to eight weeks for the acceptance to come through and the funds to be accessible. So if you will be looking for a fast closing, it's important for you to understand or know 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 a sub-optimal credit score or don't receive a regular source of income, it is normally harder to be eligible for a bank financing, with the tougher loan requirements banks have issued in recent times. So should you stop trying and abandon your aspiration to get into fix and flips? Definitely not, seeing as you always have the El Dorado hard money loan alternative.
A hard money home loan in El Dorado offers you what is considered imperative to many real estate deals — a very fast closing of just a few weeks and more often than not even less. Additionally, loans can be done for up to 70% loan-to-value of the "as is" valuation, as calculated by a professional appraiser. At first, hard money real estate loans, with starting interest rates of 10%, could be seen as higher in price than bank loans. But in reality, the lending rate is not as relevant for these loans, simply because they will never be long-term financing. Short-term loans of several months to a handful of years are best thought of in terms of cost of capital, much like all other costs related to a project. Right after you rehab and resell the property, recouping this expense is just like recovering the one for new kitchen appliances you installed in the house.
Also, it's easy to be eligible for a hard money mortgage, even if your credit rating is not that superb. El Dorado hard money lenders don't approve a loan strictly judging by the applicant's credit score — rather they also evaluate the property or home, where it is located and what it is worth, and the home's ability to pay back the loan by itself. Other criteria that affect a borrower's approval for a hard money real estate loan can include how much he is in a position to put into a down payment, his past experience being a real estate investor, and selling price of similar, fairly recently sold homes in the neighborhood.
So any time you come across a really good and lucrative flipping opportunity, rest assured you'll have a hard money lender in El Dorado, in a position to lend you the capital you need. Fill out the form or call us to talk about the project you have in mind.
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