Suppose you've stumbled upon this truly good bargain for a fix and flip property located in a great location, and you're either a skilled real estate investor or a first-timer who hopes to try out flipping houses. Everyone knows that skilled professional flippers, along the lines of Tarek and Christina El Moussa who do HGTV's reality home flipping show, Fix or Flop, can readily turn an average profit margin of $40,000 to $50,000 when they flip properties. And sure, they are aided in a major way due to their professional experience, auction skills and familiarity with hard money loans. That said, you have also been cultivating your rehab and renovation skills, have a licensed contractor ready for the project and are certain that you will be able to do an impressive job on this home.

But capital is usually a separate question entirely. A conventional lender, for instance a bank, takes at a minimum 1 to 2 months to consent to the mortgage and deliver the capital. With the home owners looking for a fast closing, that doesn't seem like a great idea to you at all.

With banks adding tougher loan guidelines in the recent past, it is now much harder for a self-employed person to get a home loan, particularly if his credit situation is not perfect. So must you stop trying and forego your desire to embark into fix and flips? Most certainly not, seeing as you always have the hard money loan alternative.

A hard money home loan in promises what's probably most sought after by real estate investors — a quick closing time of as few as a few weeks. Furthermore, hard money lenders are capable of doing loans up to 70% LTV of the home value, as established by a qualified third-party evaluation. At first glance, hard money real estate loans, with starting lending rates of 10%, appear to be more costly than bank lending products. But when you consider these loans are not long-term home loans, the rate may be misleading. Short-term loans of a couple of months to a handful of years are best looked at as cost of capital, much like any other expense related to a project. Right after you fix up and sell off the house, recuperating this expense is just like recouping the expense for new kitchen appliances you installed in the place.

Apart from this, hard money mortgages are easy qualifying, even if you have a bad credit rating. Instead of focusing exclusively on the applicant's credit score or net income, hard money lenders, who can be a privately owned company or an individual person, approve a loan after examining the property value, how easy it will be to market, where it is located, and the possibility of recuperating their money in the event of foreclosure. Adding to that, if the applicant can demonstrate past experience in comparable real estate projects, can place down cash towards the down payment, and the cost of comparable properties in the area works to his benefit, he stands an excellent chance of being eligible to get a hard money real estate loan.

So if you have stumbled on a really great real estate opportunity with a significant potential for returns, you've also found yourself a hard money lender in that's ready to provide financing for your fix and flip projects. Enter your info into the form or get in touch with us via phone to discuss the project you have in mind.