Suppose that you've run into this truly good deal for a fix and flip property you found in a great neighborhood, and you're either an experienced real estate investor or a newbie who hopes to try out flipping houses. Expert house flippers, similar to the young married couple on Flip or Flop, HGTV's reality flipping show, are able to haul in a gain of forty to fifty grand on average. And without a doubt, they are helped in a major way as a result of their professional experience, auction skills and knowledge of hard money loans. However, you're certain that your superb rehab and renovation skills can help you do an outstanding job for this property — furthermore, you've already lined up one of the finest contractors in the area to work on this job.

But where do you get the necessary capital for flipping? When you approach a regular lending institution, such as a bank for funding, it very likely will take, at a minimum, thirty to sixty days for the acceptance to be completed and your funds to be accessible. So if you're hoping for a fast closing, you must be aware that this may cost you weeks, causing you to lose out on the opportunity.

With banks establishing more challenging loan criteria in the recent past, it is now more difficult for a self-employed person to obtain a mortgage loan, particularly if his credit rating is not optimal. So does this leave you with no other option, but to drop your aspiration of venturing into flipping? By no means, especially when hard money loans can help you achieve great things in the real estate world.

If you should obtain a hard money home loan in , you're going to get what's probably most vital to real estate offers across the country — a fast closing of approximately fourteen days. Besides that, hard money lenders frequently agree to funding up to 70% LTV of the property or home's valuation, as identified by a professional third-party evaluator. With the interest rates starting near 10%, hard money real estate loans may look, at first, to be higher in price as compared with traditional bank lending products. But when you consider these are not long-term mortgage loans, the rate of interest can be misleading. As it pertains to short-term loans of a few years or less, you should think about them much like you would other expenses for your project. When you have turned the property or home and have made a positive return, you can recover this expense from the property or home — the same as recovering the money necessary for the brand-new kitchen appliances that you installed.

Furthermore, even a person with weak credit will be able to qualify for a hard money mortgage. The applicant's credit score isn't the sole deciding factor for hard money lenders — they also evaluate the piece of real estate, what is it valued at, its location, and its ability to earn back their investment if everything does not go as planned. Other variables that influence a borrower's eligibility for a hard money real estate loan include how much he can put towards a down payment, his past experience as a real estate investor, and price range of similar, fairly recently sold residences in the neighborhood.

Finding a hard money lender in to cover expenses for your flipping business is not difficult, assuming that the opportunity that lies ahead of you is promising and has a strong potential for returns. Enter your info into the form or call us to discuss the property you have in mind.