Suppose you've encountered this truly good bargain on a fix and flip property you found in an ideal neighborhood, and you happen to be either a seasoned real estate investor or a newbie who wants to try his hand at flipping. You may have heard that competent home flippers, much like the married couple on HGTV's Flip or Flop, have a remarkable average profit margin near forty to fifty thousand dollars. And yes, they are helped in a big way by their professional experience, auction abilities and knowledge of hard money loans. That said, you have recently been brushing up your rehab and renovation knowledge, have got a contractor ready for the project and are positive that you can do an impressive job on this house.

But how can you obtain the needed funding for home flipping? A conventional lender, like for example a bank, takes at a minimum 1-2 months to authorize the loan and release the funds. Thus if you are looking for a fast closing, you must be aware that this may cost you a couple of weeks, making you lose out on the house.

On top of this, banks have already been tightening up their lending standards in recent years, which makes it challenging for a person to receive a regular home loan if their credit rating is not flawless or he does not have a regular salaried job. So should you give up and forego your dream to get into the real estate market? Absolutely not, because you always have the hard money loan option.

If you decide to obtain a hard money home loan in , you're going to get what's perhaps most vital to real estate purchases throughout the country — a quick closing of about 2 weeks. Furthermore, hard money lenders are able to do funding up to 70% LTV of the property value, as estimated by a professional third-party evaluation. With loan rates starting at about 10%, hard money real estate loans may look, at first, to be more pricey when compared with traditional bank loans. But usually, the rate of interest isn't as relevant for these loans, simply because they aren't long-term financing. The cost of such short-term loans should be considered on par with any other cost that you will encounter in the course of the project. When you have sold the home and have made a good profit, you're able to recover this expense from the property or home — the same as recovering the money spent on the brand-new home appliances that you have installed.

In addition, even an individual with bad credit can still be eligible for a hard money mortgage. Rather than focusing primarily on the applicant's credit score or income, hard money lenders, who can be a private company or an individual person, say yes to a loan after examining the home value, its marketability, its location, and the probability of recouping their capital in the event of foreclosure. Additional criteria that have an impact on a person's acceptance for a hard money real estate loan include how much he is in a position to put into a down payment, his past experience as a real estate investor, and selling price of comparative, just recently sold residences nearby.

So should you run into a good and lucrative flipping opportunity, be assured you'll have a hard money lender in , in a position to loan you the cash you need. Fill out the contact form on this page or give us a call and let's discuss the project you have in mind.