A fantastic deal on a fix and flip property in a good subdivision suddenly turns up — seems too good to be true. Expert home flippers, similar to the young married couple on Flip or Flop, HGTV's reality flipping program, are able to bring in a profit of forty to fifty grand for the majority of homes. It goes without saying their past experiences rehabbing, understanding of hard money loans, expertise in their housing market, and auction talents have played an important role in their success. Still, your rehab and renovation knowledge isn't bad either — aside from that, you've already identified a good building contractor to tackle this home.

But funding is often a separate issue altogether. If you approach a standard lender, like a bank for a loan, it is very likely going to take a minimum of 30-60 days for your acceptance to come through and your funds to be furnished. Given that home owners wish to have a fast closing, it may be advisable to start looking for some other financing options.

With banks establishing more challenging loan guidelines in the past several years, it's become much harder for a self-employed individual to find a mortgage loan, especially if his credit score is not perfect. So will a lack of funding stop you from sticking with your ambitions? Definitely not, because you also have the hard money loan alternative.

If you put in an application for a hard money home loan in , you'll get what is possibly most essential to real estate purchases throughout the country — a very fast closing of roughly 2 weeks. Besides that, hard money lenders are able to do funding up to 70% LTV of the home's valuation, as established by a credentialed third-party appraiser. With lending rates starting off near 10%, hard money real estate loans might appear, at first glance, to be higher in price in comparison with conventional bank loans. But in reality, the lending rate is not as relevant for these loans, given that they will never be long-term financing. As it pertains to short-term loans of 1 or 2 years or less, you should think of them identical to any other expenditure for your project. And once you've turned the house, recuperating this expense is comparable to recuperating the expense for all the kitchen and bath updates you did.

Aside from that, hard money mortgages are not hard to qualify for, regardless if you posses a low credit score. hard money lenders do not authorize a loan exclusively on the basis of the applicant's credit score — instead they additionally examine the home, its location and value, and the home's ability to pay back the financing without the help of the person. Adding to this, if the borrower can demonstrate past experience in similar real estate endeavors, can place down cash for a down payment, and the cost of comparative properties in the vicinity works in his favor, he stands a very good likelihood of qualifying to obtain a hard money real estate loan.

So any time you run into a very good and profitable flipping opportunity, be assured you will have a hard money lender in , able to loan you the cash you may need. Enter your info into the form on this page or get in touch with us via phone to talk about your project.