Learn To Be A Fix & Flip Investor

Saturday, February 25, 2017

California Hard Money Lenders and Personal Loans

By now, you know that California hard money lenders offer a variety of lucrative lending programs for specific residential properties and commercial ventures. But, did you know that California hard money lenders are also in the business of personal loans?

Before you run to find your top California Hard money lenders for a personal loan, it helps to get a better understanding of what qualifies as a hard money personal loan in lenders’ eyes. For starters, personal loans that involve hard money financing, unfortunately, cannot be used for whatever your heart desires. Unsurprisingly, there are several regulations as to what you can use your hard money financing for.

For example, a personal loan with hard money financing can be used to purchase a car or provide the necessary capital to start a small business. These particular kinds of loans can also be used for your traditional commercial ventures, mobile home parks, retail stores and multi-family family housing if you so choose. The point here is that the real regulation with hard money and personal loans is more about you as a borrower. Think about it this way, most borrowers seek out hard money financing for hard to finance business endeavors. These endeavors are harder to secure financing for a variety of reasons. For instance, if it is a new business or a startup, then working with lenders that offer hard money financing may be your best option.

Of course, if you are looking to fix and flip a property or make improvements than you may need hard money financing for different reasons such as less than stellar credit. With hard money personal loans, you very well may fall into these above-mentioned categories or borrowing scenarios however the real issue tends to your borrowing fitness if you will. Your borrowing fitness is really just a nice way of saying that you either have the perfect credit score, the right paperwork and so on or you do not. Thus, when you are the verge of dealing with lenders who offer hard money personal loans, you may feel as though you have reached the end of the line; but, the good news is you haven’t.

The Pitfalls of Rotten Credit
So you have determined that your borrowing fitness is less than perfect and traditional as well as non-traditional lending institutions are unwilling to work with you. You may even truly think that there is no way to see your latest business plan or improvement project through. But again, as briefly suggested, you can overcome these pitfalls. This means improving your borrowing fitness in the long run of course, but it also means working with a lender that understand your less than perfect credit or rotten credit and your vision/ endgame.

Your Win-Win Solution
Ultimately, this is where hard money personal loans can help or be the most beneficial. Thus, as you can see, it would behoove you to find a reputable lender of hard money personal loans if you have been turned away from what feels like every lending institution. If you do not know where to start your search for these particular kinds of lenders, it never hurts to ask your local broker or to simply ask around.

Happy senior business man making his notes at work

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.

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Friday, February 24, 2017

Simple Steps to Securing a Business Loan

So, you have made a big enough dent in your industry to take your small business to the next level. Well, let’s celebrate with a how-to-guide on securing a business loan, shall we?

Surprise! If you didn’t know by now that you were going to need outside financing to take your small business next level, well now you know. The truth is as your business starts to grow simple things like payroll and inventory that use to take you a few hours to complete now take days or even months alone. So, what else can you really do but choose to expand?

Yet, since you are considered a small business by most lenders, you will quickly find that it is somewhat difficult to secure a business loan initially. But, that doesn’t mean it’s impossible. In fact, the best way to secure a business loan for your small business is to get in the know and start applying. By “get in the know” we mean understanding why you need the money, narrowing down your loan options or types, finding the lender that gets you and seeing if you qualify. After all of this is accomplished, really all that’s left is to get the necessary documents together and apply.

But, wait this sounds fairly cut and dry. It may seem so cut and dry, in fact, that you are wondering why people say it is difficult for small business owners to secure additional financing? Well, the obvious answer is, it’s more about qualifying or rather meeting your lender’s requirements than it is about getting your paperwork together and coming up with a clear plan. But, the good news is by getting in the know i.e. completing the above-mentioned steps you will actually make it much easier for yourself and your business when it comes time to meet those pesky lender requirements.

How to Get in the Know

When meeting with potential lenders or your future lender it is important to know exactly why you need this loan, so again make sure you know as well and preferably beforehand. Next, you need to decide which loan is right for you. This step is actually not as hard as it seems because if you know why you need the loan then you can find the right loan. For instance, if you are looking for some financial assistance in managing the day-to-day expenses more than likely you want a short-term cash flow loan or a line of credit. If on the other hand, you want an additional financing to grow your business then you should be looking at term loans. Based on these two steps, your next move is, of course, finding the right lender (note: if you have bad credit you might want steer away from traditional lenders).

Exceed Your Lender’s Expectations

So how does all of this help you exceed your lender’s expectations? Well, it makes it much easier to figure out key factors that affect your approval such as your credit score and it helps you to see if you are truly in a position to secure a loan( been in business more than 2 years, meet the minimum annual revenue requirement and have the ability to make payments).

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Finding Private Money Lenders in California

So you have heard that private money lenders in California are practically on every corner, but now that you are actually looking for private money lenders in California you do not know where to begin. Well, the good news is you came to the right place to figure everything out.

It is true that Private money lenders in California have a lot to offer potential borrowers; thus, it is no surprise that you are looking to work with them. In general, the best private money lenders are often found by networking, as private money lenders tend to be individuals or non-financial institutions. Moreover, the very nature of borrower and private money lender is more relationships-based, if you will.

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Therefore, it almost goes without saying that, before you embark on a vast search of lenders in California you should network (primary circle acquaintances i.e. friends, family, co-workers and even neighbors) and asking your real estate acquaintances (secondary circle). Nonetheless, if you are just starting out in the business of commercial and residential real estate, you may not have as many contacts as you would like, which is perfectly okay. This is what the Scotsmen Guide, private money lender directories, and Goggle were created for—you have to begin somewhere right? Of course, you may be a little wary of using Google or some other internet search engine, but you shouldn’t be—there are dozens of reputable you can find with a cursory search online.

Besides taking advantage of directories, guides, online searches, and networking, you can also find lenders in a few other ways. For instance, you can look for reputable lenders via investors (third party circle) or through contact sites. These particular sites are little different that your standard directories and guides, but there is no need to worry, navigating contact sites become second nature in no time at all.

How to Navigate Contact Sites and More
With that being said, here is a mini-tutorial of how to navigate these above-mentioned contact sites. For starters, the contact sites that are used the most tend to be Lenderpost, Lending Club, and Bigger Pockets Marketplace—just to name a few. On these sites, not only do you have access to valuable lending information, you also have a forum for finding your private money lenders or at least a place that will point you in the right direction in terms of your search. Furthermore, if you are trying to maximum the number of private money lenders available to you, you can also take advantage of investor direct mailing list. Remember, you are in control of your real estate or commercial endeavor, so make it happen by whatever means necessary.

Other Things to Consider
If after doing all of this, you still cannot find a private money lender that meets your needs, then do not be afraid to reach out locally to lenders. However, it is important to note that the likelihood of you not finding a private money lender by using these tips is pretty much non-existence. Therefore, drop whatever you are doing and start your lender search today—make your real estate endeavor a reality.

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How To Make Money With California Hard Money Lenders

The obvious way to make money with California Hard Money Lenders would be to take a loan out so that you can flip a house, but that is not the only way to do so—you can also invest in hard money loans.

The entrepreneurial spirit is alive and well in the United States, but since many people do not have the best credit, the have a hard time getting approved for a loan through traditional channels. Lucky for them, there are other options available—such as California Hard Money Lenders.

But seeking out a loan so you can start a business is not the only way you can make money with a California hard money lender. Rather than take out a loan with one, you can invest in the hard money loans they are approving.

Investing With California Hard Money Lenders
But wait? Don’t most California Hard Money Lenders take on clients that are less than reputable? There has to be a reason why the banks said now. Why should I trust them with my money? Am I really going to see it again?

Yes, there is an element of risk, much like there is with any investment. But it is important to remember that banks are unforgiving in their approval process. If you’ve made one mistake or haven’t got enough income coming in to make them happy, that can be enough to get declined. That doesn’t mean the borrower is untrustworthy. If anything, it just means they are human.

If that actually does concern you, then you can do something about it. When you invest in California Hard Money Lenders you are in control of your money and will get the chance to know everything you need to know to make the right decisions for you:
- You will know exactly what piece of real estate your money is being used for and its worth
- Who the borrowers are.
- What the rate of return will be.
- What safety and security measures that are in place to make sure the investment is safe.

Ready To Make Some Money?
Taking out a hard money loan and opening a business is one way to make money, but what if you don’t really have the entrepreneurial spirit in you? What if you don’t want to have to go through all the work it takes to set up a business and get it running? What if you would rather take advantage of someone else’s hard work and profit from it?

Of course, if you do invest in hard money loans you will still need to do some homework to see what projects and/or people you are going to be interested in investing in. But once you do that, your hard work is over. All you have to do is sit back and watch someone else do all the work making you money.

It’s not as inventive as opening a business, but who cares as long as you make money?

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Small Business Must-Haves when Applying for a Business Loan

You probably heard it all before, you absolutely need this piece of documentation and this info regard x and this report to explain y when applying for a business loan. But, if you are like most people, after a while you get lost in all the noise and simply aren’t sure what you truly need when applying for a loan.

As a small business, you are more than likely just getting your feet wet when it comes to applying for a business loan, which is perfectly okay. Everyone once had to start somewhere and additional financing for any business can be a godsend. With that being said, let’s make it a little easier to get your business loan by cutting through some of the red tape.

For starters, it is true that you will need important documentation such as your business and personal tax returns. You will also need your business and person bank statements, your business financial statements as well are your business legal documents i.e. articles of incorporation, your commercial lease, franchise agreement and so on. Your lender may not necessarily require all of these items but it is always in your best interest to have these items on-hand when trying to secure your business loan.

Nevertheless, at this point, you are probably looking for those must-haves that were mentioned earlier and rightly so. Obviously, some of these top must-haves will not be revolutionary i.e. it is not shocking that you need strong credit to secure additional financing for your business. But, other must-haves like an updated, detailed business plan that even covers your social media presence kind of is revolutionary; since only as of recent have lenders started to factor a company’s social media presence into their overall decision to approve financing.

Be Successful and Be Prepared

Other must-haves you should have handy when applying for your loan include a compelling personal resume, credible P&L statements and in-depth knowledge of the actual loan you are trying to secure. A compelling personal resume makes the list of must-haves because traditional lenders as well as most lenders in general want to know that they are investing in a qualified individual. Obviously, your ability to run your business successfully hinges on your skills, talent and know-how, so don’t be afraid to show it. Additionally, when it comes to your personal resume make sure you thoroughly proofread it and edit your resume to near perfection. In terms of having credible P&L statements, this means your P&L statements should speak to your reliability, ethicality, and professionalism. Lastly, you already know that knowledge is power so if you truly want that loan, take the time to research your many lending options and pick the right loan the first time.

The Benefits

Clearly, the benefits of being well-prepared and on top of all your lender’s must-haves means that you are more than likely to secure that loan of yours. So, don’t think you can just fill out an application and wing it. Today’s lenders aren’t afraid to turn a small business down so you shouldn’t give them a reason to.

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Hard Money Loans – California Owner Occupied Properties

Securing financing can be difficult, especially if you are in the market for owner occupied hard money loans. California lenders, much like other lenders, are not necessarily quick to offer owner- occupied financing but that does not mean you don’t have any options.

If you have been in the real estate investment business for some time, you are probably well aware that it is not easy to secure owner-occupied hard money loans. California lenders who offer hard money financing often shy away from the additional regulations or red tape that is placed on owner- occupied properties. However, the good news is not all California lenders fear the challenge.

The reality is that some lenders have the impression that due to the additional regulations it is almost illegal to offer these particular types of hard money loans. California being almost the mecca of lenders it seems that there would be more clarity on the subject here. But, the truth is that many lenders are still in the dark about owner occupied property regulations and hard money. So, at this point, you are probably wondering what the deal is? Can you secure hard money financing for owner-occupied properties or not?

Well, unsurprisingly, the answer is a little complex. Nevertheless, it is important to highlight the fact that owner occupied properties secured via hard money is perfectly legal. The difficulty here lies in the overwhelming misconceptions about owner-occupied lending laws. Moreover, for most lenders, it boils downs to the limitations placed on them in terms of fees and so on. Thus, lenders shy away. But, what does that mean for you? It means that you need to do your due diligence and find a lender that understand your vision, the lending laws and is willing to do the work with the regulations. This may seem like a tall order, but no one ever said getting what you want would be easy.

Additional Regulations
In addition to having a limit to the fee amount that can be charged, owner occupied loans also come with a few more requirements. For instance, a borrow income has to be verified via a third party source. Moreover, if the loan falls under the high-cost loan category then hazard insurance along with property taxes needs to be collected via an impound account for the first year. Along those same lines, a high-cost loan can also mean prepayment penalties are an issue for the lender. In fact, lenders must offer loan option that does not have prepayment penalties in this event. There are also similar disclosure regulations and requirements that one would typically see with bank or traditional lending institution loans.

The real deal
Ultimately, these are the main regulations that cause many lenders to not offer owner-occupied hard money financing. But, as you can see, these regulations and requirements are not necessarily the end of the world. Therefore, if you are in the market for this particular kind of financing, do not be deterred by lenders who are unwilling to abide by these requirements.

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