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Monday, May 28, 2018

Advantages of Hard Money Loans Arizona

It is true that hard money loans cost more in interest and fees than most traditional loans. But there are several advantages of using hard money loans Arizona.

Most borrowers are focused on trying to find the most affordable lender when they are seeking a loan. And thinking along those lines is likely to keep many borrowers from taking advantage of all of the benefits of hard money loans Arizona. But investing just a few minutes in exploring the advantages of hard money loans could easily change some borrower’s opinion of hard money loans Arizona.

As a business person, your time is very valuable. And hours spent completing traditional loan applications are costing you money. The time could be better spent managing and growing your business. The much simpler application process of hard money loans Arizona is a great way to save yourself time and the stress that is associated with completing forms and compiling bank statements and other documentation.

Another advantage of hard money loans is the fact that you will not need to submit your personal banking and financial statements to the hard money lender as you would if working with a bank. Traditional lenders are interested in business creditworthiness and financial health as well as the personal financial situation of each owner of the business. However, a hard money lender is only focusing on the current market value of the property which will be the collateral for the loan.

Self-Employment is Not an Issue

Many banks and traditional lenders have very specific criteria for funding a loan when the borrower is self-employed. This can make it even harder than normal for a borrower to qualify for a loan. But a hard money lender does not see self-employment as a negative. And in some cases they prefer it as it shows initiative and the desire to commit to hard work to become successful.

Used Correctly Hard Money Is a Great Tool

Hard money loans are not the perfect solution for every borrower. If you are looking for a long term loan, or if you need to borrow the entire purchase price of a property, then hard money lenders will be of no help to you. But if you are looking for a short term loan that can be funded quickly, then hard money is for you. The application process is much less lengthy and the criteria for approval is related more to the actual current market value of the property than it is your credit score. So borrowers with poor credit or no credit will have a fair opportunity to secure a hard money loan.

Not only is applying to many banks time consuming but it is also humiliating to be turned down time after time. But you can avoid the embarrassment and the wasted time by presenting your request to a reputable hard money lender. With a solid plan to purchase and resell for a profit, you have a higher than average chance of getting the funding that you need from a hard money lender.

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC Private Hard Money Lender
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701

About the Author: Dennis has been working in the real estate industry in some capacity for the last 45 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

How to Find Reliable Hard Money Lenders Arizona

Finding reliable hard money lenders Arizona is not as easy as driving to a bank or mortgage company. You will need to invest some time to find the best hard money lender to meet your needs.

Most first time hard money borrowers are not very familiar with the process or their options when it comes to selecting a lender. So it can be very tempting to just accept the first lender who is willing to make you an offer. But there are a few key questions that you should answer when you are assessing potential hard money lenders Arizona.

The hard money lenders website is going to tell you a great deal about how they do business and the actual type of service that they offer. Some sites are very basic and are only used to gather your information. They provide no details about the lender or the types of terms that they offer. Often times you learn after the fact that these sites do not belong to actual hard money lenders Arizona, but instead they are operated by an intermediary or broker who is collecting information on potential borrowers and then turning it over to an actual hard money lender. This is not a person that you want to deal with as they are going to add fees and provide you with no real service. You only want to work directly with the lender.

Professionalism is another important factor when selecting hard money lenders Arizona. You want to work with a lender who can meet your financial needs but also your customer service needs. Reliable contact information, a staff that promptly returns calls and emails and clear and professional documentation are all indication of a professional lender and not a fly by night entity.

Finding a Good Match

Not every hard money lender is going to be a good match for every potential borrower. Some lenders focus only on commercial properties while others prefer to focus on residential properties. Selecting a lender who regularly funds projects similar to yours will undoubtedly make the process smoother and faster which is often a driving motivation for using a hard money lender.

Do Your Homework

Any lender, whether a hard money lender or a traditional lender, is simply a service provider. You would never select a builder for your next home, a contractor or even a car mechanic without checking out the business and its reputation. So you need to commit to the same process with a hard money lender. Be certain that they are in good standing with other borrowers and that they are not embroiled in any legal issues. Check out their reputation with previous clients. Did they offer a professional process and service throughout the life of the loan? Were they reasonable to work with one terms and payments? All of this information will give you insight into what your hard money borrowing experience is likely to be when working with that lender.

Wednesday, May 23, 2018

What Are Hard Money Loans Arizona?

Understanding hard money loans Arizona will provide investors with an additional lending resource when they are interested in investing in real estate. It will also greatly reduce the time involved in securing funding.

Hard money loans Arizona are just loans that is secured by real estate. In addition, these loans are funded by private investors or lenders instead of the traditional banks or loan companies. In most cases, the loan is short term such as a 12 month time frame or even as short as three or six months. But the term can be extended to as long as two to five years. Another term used for this type of loan is asset based lending.

The terms of hard money loans Arizona are flexible because the lender is not obligated to follow the same rules and restrictions that traditional lending institutions must follow. The private lender is able to work more closely with the borrower to create terms that are mutually beneficial to both parties. For this reason, many borrowers prefer hard money loans Arizona over traditional loans.

In addition to being flexible with the repayment terms of hard money loans, borrowers also like the fact that it is much easier to qualify for a hard money loan than a traditional loan. Instead of the lender reviewing the borrowers credit, income and current debt load, the lender is really only interested in the current value of the property that is going to be used as collateral for the loan. This allows borrowers with no credit or poor credit to still be able to qualify for the hard money loan.

Deals the Could Require Hard Money Loans

Hard money loans are not the perfect solution for any type of deal. They are financed at a higher rate than a traditional loan and also can have additional loan fees which are charged to the borrower. In most cases, if a borrower can get a traditional loan, then that is the best solution. But when banks are not willing to fund a loan request then hard money is a viable option. Deals such as a short term fix and flip, land loans, construction loans and deals that have a very short time frame for funding are all prime examples of the perfect reason to select a hard money loan.

Properties to Secure a Hard Money Loan

A borrower can use just about any type of property to secure a hard money loan. The only qualification for a property is that the lender be willing to accept that type of property as collateral. Often times a lender would prefer a single family home as collateral because it has a more stable market value and is easier to liquidate if the borrower defaults. But multi-family residential, commercial, industrial and even unimproved land can all be used to secure a hard money loan.

Understanding how a hard money loan works and when it is beneficial, offers borrowers a legitimate option for funding when a traditional lender has declines a loan application.

Friday, April 27, 2018

How to Qualify for a Spec Construction Loan

First-time real estate investors could find spec construction loans a challenge to qualify for and very complicated. Get a sense for how construction loans are different from conventional mortgages and some strategies to maximize your chance of qualifying.

Construction loans differ from ordinary commercial loans in a variety of ways. They are more complicated than regular mortgages and funding is given according to a specific timetable. An initial amount of funding will be given to the borrower, and then the remainder of the loan will be dispersed on a monthly basis, or at the borrower's request. Most lenders will require verification of a borrower's expenses over the course of a construction project, which can create complications.

Construction loans are especially tricky to qualify for and are considered too risky by most banks. Most lenders have difficulty underwriting construction loans because they have to rely on the borrower's assumptions about the cost and profitability of a given project. Most lenders are especially wary of spec loans and consider them too risky because there is no guarantee of a future sale.

A spec loan is usually given on a short-term basis and is not meant to be a long-term mortgage. The aim of the borrower is to sell the property quickly after construction is completed. It is crucial that potential borrowers can demonstrate their expertise in order to qualify for a spec loan.

If you can talk up your expertise to increase your chances of qualifying for a spec construction loan

Your financial projections are what a spec lender will rely on to underwrite your loan and so it is essential to demonstrate your expertise. If a lender doesn't have faith that you will finish a project, or that you will earn a profit in the end, in most cases your construction loan won't be approved.

The best way to qualify for a spec loan is to give any potential lender confidence in your knowledge and experience when it comes to real estate. But there are additional strategies you can employ as well.

Specific tactics to help you qualify for a spec construction loan

Seek out lenders located near your construction site. A local lender will have an emotional investment in the area and will have a better understanding of your project's potential. Ensure you have enough capital up-front to make a sufficient down payment. Lenders will want an assurance that you have a sufficient stake in your construction project. The risk entailed by a spec loan usually entails a significant down payment.

Have a detailed understanding of your builders draw-process, meaning know how much your builder intends to spend at every step of your project and be sure this schedule matches the structure of your loan.

In short to qualify for a spec loan, demonstrate your expertise, find local lenders, have sufficient cash on hand and know your projects timetable. By employing these strategies, you maximize the chances of your spec loan getting approved.

Wednesday, March 21, 2018

The Requirements for Securing Commercial Real Estate Loans

Due to the dollar amount of most commercial real estate loans, the criteria to qualify is more stringent. It’s important to understand these requirements before you apply for a loan.

Not only are commercial real estate loans substantially larger than most other loans, they are also inherently more risky. This increased risk is due to the fact that most businesses financial health is very closely tied to the overall economy unlike the financial health of a consumer which is more insulated. To offset this risk as much as possible, lenders are much stricter about the qualifications for commercial real estate loans.

The first step in securing a commercial mortgage is to have the property appraised. Legally, the lender will need to have this process completed but it is not a bad idea for the borrower to also have an appraisal completed. It is critical that the property value be equal to or exceed the amount of the loan being requested. This is simply because the property will be the collateral for the loan. Most lenders want to see the property value at least 20% greater than the loan amount to ensure that the collateral is always greater than the outstanding balance of the loan.

When a business entity is making the purchase, the lender is going to want to verify that the business is financially stable and has the ability to make the loan payments. The lender will request documentation to verify the cash flow of the business as well as the debt that the business is carrying. Lenders prefer to see a steady net income 20% greater than the debt. It is also important that the business have some type of savings or other assets which are very liquid in the event that the business slows and cannot make the loan payments from the months’ income.

If the business entity does not have a strong credit history or is relatively new, the lender will require the owner of the business or owners to become personal guarantors. This basically means that the business credit history does not merit the loan and the owners are willing to use their personal credit history and scores to obtain the loan. This also means that the owners are willing to use their own personal funds and property as collateral for the loan.

Understand What Lenders are requiring

In many cases there are nonrefundable fees which must be paid to apply for commercial real estate loans. Knowing that your business or your personal credit is strong enough to secure a loan is very important before you begin the long process of a loan application and pay the fees to have the application processed. If you have any questions about the qualifications, you should invest your time in more research.

Due Diligence

There is a lot to understand when seeking a commercial loan and researching the process, the potential lenders and the criteria for securing a loan is a very smart choice. Speaking to a local bank or a mortgage lender is a good way to gather information and learn about the process to help you avoid wasting both time and money if you are not prepared to meet the loan application qualifications.

About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Wednesday, January 11, 2017

Deed of Trust Definition - What is a Deed of Trust

What is a Deed of Trust?

A deed of trust (also know as trust deed) is a deed (piece of paper usually recorded at the county) that gives legal title to real estate to a trustee. It secures the note (Mortgage).

There are three parties to this type of title. They are:

The Trustor (Borrower),
Beneficiary (Lender) and a
Neutral 3rd part called the Trustee.

They are written so that the lender gives money to the borrower to purchase a real property (home) and the borrower signs a deed of trust giving the power of sale for property to the natural 3rd party trustee to be held in trust for the lender. (I like to think the trustee takes the Deed of Trust and puts it in the top drawer of their desk and waits.) The borrower owns the property, but the title is held by the trustee.

This is noted in the Deed of Trust and is called the ‘power of sale clause’ for example:

About Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true.

Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

Saturday, November 21, 2015

Work at Home? Using Hard Money Loans, Texas’ Self-Employed Can Become Homeowners

It’s kind of odd the way people who follow the American dream and choose to start their own business get penalized. In many cases, it disqualifies them from becoming homeowners with traditional mortgages, but with hard money loans, Texas’ self-employed people can own a home, too.

“Good Luck Getting a Mortgage.” That was CNBC’s message to the self-employed when they covered just how difficult it is to buy a home when you’re your own employer. It’s hard enough to get a mortgage as it is, but those who work from home or freelance have an even more difficult time. A study from Zillow discovered that self-employed individuals only get six loan offers for every ten that traditional employees do.

Difficulty obtaining an offer is just the start of it, though. CNBC reported that some banks are demanding several years of tax returns, corporate tax returns, and even Googling their applicants. One unlucky would-be borrower was quizzed about the names of clients who were using her freelance writing services, which she aptly summed up as “intrusive.”

Data shows that self-employed people make about 81% more than those who work for traditional employers, but that doesn’t seem to matter to banks. Entrepreneurs wind up having to fork over an average down payment of 15.3% percent, while their salaried counterparts generate a mere 14.6%. Using hard money loans, Texas’ self-employed can get around some of the issues, but very few people are familiar with the method, even though it’s been around for seemingly forever.

When Considering Hard Money Loans, Texas Borrowers Don’t Have to Worry About Eligibility

When doling out hard money loans, Texas lenders tend to focus more on the value of the property being purchased, rather than the financial background of the individual applying. This makes it much easier to get approved, and far less “intrusive.” Because the self-employed have so much more paperwork to manage with a traditional mortgage, the length of time it takes to seal a deal can be months, if it ever happens at all. With this method, the timeline is much shorter, even compared to what a salaried employee might endure. Loans are often funded within days, rather than the weeks or months a traditional path might take.

To get advice on hard money loans, Texas borrowers should always consult a pro.

There are many varieties of hard money loans Texas lenders specialize in, and there are solutions for just about every circumstance. While some options are geared more towards people who purchase with the intent to rent or flip, certain packages are put together especially for people who are self-employed. For this reason, it’s always a good idea to speak with someone who handles several types of loans, so you can be sure you’re getting the right one for your needs. CNBC’s succinct quip was sadly true about the traditional mortgage industry. Thankfully, there are other means available that put homeownership within reach, even for those who write their own paychecks.

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
dennis@level4funding.com
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

About the author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true.

Dennis has been married to his wonderful wife for 38 years. They have 2 beautiful daughters 4 amazing grandchildren. Dennis has been an Arizona resident for the past 32 years.

Tuesday, November 10, 2015

How to Make Your Retirement Dreams Come True With Hard Money Loans Texas!

When it comes to retirement savings, most people know the basics, 401ks, 457s, 403s, stocks, bonds, and many more options. But, did you know there are several disadvantages to these traditional options. Namely, they are dependent on the stock market, which we all know can be fickle, to say the least.

With ups and downs in the market, many folks are finding that they are losing their retirement savings. Take the story of one of my employees, for example. Her husband is a fire fighter with the majority of his retirement savings in a 457 fund. This quarter, they LOST $20,000. Now luckily, they are young and have time to make that money back, but all I could think when she was telling me this was how much better off they would have been investing in hard money loans Texas.

You are probably thinking why, what makes hard money loans Texas a better retirement option than many traditional plans? Well, the answer is simple, hard money loans Texas are not dependent on the stock market and don't fluctuate from day to day as drastically. This is because hard money loans Texas are a real estate investment which is generally more stable since it is not affected by an earthquake in Brazil or the quality of the air in China (seriously, these things can and do tank the stock market).

If my employee and her husband had used that twenty grand as a down payment for a Texas hard

money loan, they could have worked with Texas hard money lenders to fund the rest of the capital for a real estate purchase. They could have purchased a fix and flip property, vacation rental, or even a long term rental property. These would have made them money as either a fix and flip or long term monthly income. Either way, I guarantee they would have made well more than $20,000 and lost nothing if they made a smart investment. Much better than waiting and hoping there isn't a nuclear power plant meltdown in Japan.

When you are investing in hard money loans Texas, it is important to keep a few things in mind to help minimize your risk and maximize your profit. Always work with professional Texas hard money lenders who have experience with hard money loans Texas. Each state has different regulations so having a lender who knows the laws in Texas is key. Also, make sure to work with a real estate agent who knows his stuff when you buy the property and always do your due diligence as far as appraisals and inspections go.

If you work hard, you may find that hard money loans Texas are not only a great way to supplement your retirement income, but may also become a full-time job and passion.