Hard Money Loans in Erie
A fantastic buy on a fix and flip opportunity in an excellent subdivision shows up out of the blue — sounds so good that it is difficult to believe. Everybody knows that skilled professional flippers, like Tarek and Christina El Moussa who star in HGTV's reality flipping show, Fix or Flop, can readily make an average profit margin of forty to fifty thousand dollars when they rehab properties. And yes, they are helped in a major way due to their professional knowledge, auction abilities and knowledge of hard money loans. Still, your rehab and remodeling knowledge isn't bad either — in any case, you've already found an ideal contractor to take on this project.
But where do you obtain the necessary capital for flipping? A traditional lender, for instance a bank, takes at a minimum 1-2 months to approve the financing and deliver the money. Since the majority of home owners give preference to a fast closing, it may be best to begin looking for other funding options.
With banks bringing in tougher loan guidelines in the last few years, it is more challenging for a self-employed individual to find a home loan, especially if his credit rating is not flawless. So does this leave you with no other option, but to abandon your aspiration to venture into home flipping? Under no circumstances, particularly when Erie hard money loans enable you to accomplish great things in the real estate world.
If you decide to apply for a hard money home loan in Erie, you will get what's perhaps most important to real estate negotiations across the country — a fast closing of roughly 14 days. And additionally, loans can be made up to 70% loan-to-value of the "as is" home value, as determined by a qualified appraiser. Some individuals believe hard money real estate loans to be higher priced than standard loans, considering interest rates for such loans normally start at 10%. But in reality, the interest rate is not as useful a measure for these loans, because they aren't long-term loans. The cost of such short-term loans ought to be considered on par with any other financial outlay that you would need to meet for the project. Once you have turned the house and have made a good gain, you're able to recover this expense from the house — just like recuperating the money spent on the brand-new home appliances that you've put in.
Furthermore, even individuals with poor credit will be able to qualify for a hard money mortgage. Instead of focusing strictly on the borrower's credit score or net income, Erie hard money lenders, who could be a private company or an individual, say yes to a loan after examining the home value, how easy it will be to market, its location, and the odds of getting back their money should they have to foreclose the loan. Adding to this, if the borrower can demonstrate prior experience in comparable real estate projects, can put down cash towards the down payment, and the price of comparative properties in the area works to his benefit, he stands a very good likelihood of being approved for a hard money real estate loan.
So any time you run into an outstanding and profitable flipping opportunity, be assured you'll have a hard money lender in Erie, ready to loan you the cash you will need. Enter your info into the contact form or give us a call to talk about the project you have in mind.
A loan specialist will be in touch shortly