Learn To Be A Fix and Flip Investor: October 2017

Monday, October 30, 2017

Commercial Loans In Texas – What You Need To Know About Working With the SBA-Part 1 - Benefits

While there are many sources of commercial loans in booming economies, like that of Texas, many small business owners often turn to the Small Business Administration (SBA) for their lending needs. Even though many small business owners find lots of helps with the SBA, there is a lot to the process.

Dealing with the Small Business Administration is like dealing with any other government bureaucracy. The benefits might be very good for you, but wading through the endless amounts of red tape and paperwork can be discouraging to even the most stalwart of pursuers.

But why should a business owner pursue a commercial loan from the Small Business Administration anyway? Why is the SBA different than any other lender? There are actually a number of benefits that an SBA loan has over traditional lenders,

One of these benefits is that the cost of obtaining such a loan is usually lower than it would be by pursuing a similar loan through a bank or other traditional lender. This means that the borrower will have to put forward a smaller down payment (and some SBA loans actually include, or have provisions to include, the entire cost of the loan).

Another benefit that is incredibly appealing to many small businesses is that there are often lowered requirements in order to secure a loan. While many traditional lenders require sources of collateral or an excellent credit history in order to secure a commercial loan, the SBA, for the most part, does not require a borrower to have any collateral. In fact, the SBA often grants businesses loans based on cash flow, rather than credit history. This makes it an excellent source of funding for those business owners who have taken some financial hits in the past. If decent cash flow can be demonstrated, it is most likely that the SBA will be able to work with you to find funding.

Term lengths and interest rates are another appeal of the SBA to small business owners. The repayment terms are usually much longer than that of traditional lenders, with many commercial loans having a term of up to 25 years. That is a tremendously long period of time to pay a loan back in the world of commercial lending. In addition to a more agreeable timetable, the interest rates of loans from the SBA also has the potential (this is not always the case) to be lower than traditional sources and significantly lower than hard money loans. Longer terms and lower rates mean that small businesses can focus on growth, rather than debt.

How can I use the benefits to my advantage if I am looking for a commercial loan to expand my business in Texas?

If you are in a position where your small business needs access to capital, but you are either just starting out or have had some credit problems in the past, the Small Business Administration might be an excellent source of help with a commercial loan to help you achieve your business goals. This could even help you to take advantage of a great business opportunity with a commercial loan in Texas.

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

Things to Consider When Looking to Apply for Commercial Hard Money Loans

Commercial hard money loans can lend a helping hand when a borrower needs a quick loan. It is still always helpful to do plenty of research and know the best ways to approach this process from the beginning of the application to closing.

First, start looking for a reputable and dependable lender that specializes in commercial hard money loans. This is when referrals really come in handy, so don’t be afraid ask others that you trust who they may recommend. Next, structure and design a plan. You want to be prepared when you are going to meet with your lender. Make sure that when you meet with your lender, present a thorough plan that includes long-term goals that you have in mind for business. Also, always include specifics like deadlines and other important dates.

The plans that you present to your lender should not only include deadlines and other important dates, but also the address of the property, the reason for the loan (is it a new loan or are you refinancing an existing loan), the property purchase price and the budget you have set. You can find a number of ways to present this information, just be prepared and have all the information present that is needed for the lender to make their decision. The more prepared you come and the more information that you present, the more likely that you will see approval.

Commercial hard money loans require certain documentations for a better chance of approval. A note and deed of trust is almost always required documents. Other documents your lender might request to review include financial statements, tax reports and proof income. Also, a personal guarantee for the borrower could be very beneficial.

Using lenders for commercial hard money loans are there when you need them but at a hefty cost

The thing to always remember when it comes to commercial hard money loans is that they will come with much higher interest rates and other fees compared to conventional loans. Because the risk is much higher with these loans, rates usually range between 10 percent to 15 percent on average. This may also include prepayment penalties. Of course, extensions could be possible, but you need to negotiate all of the terms and have an open line of communication with the lender at all times. This is why finding the right one you can trust and that is dependable is so important.

Know the eligibility time of your commercial hard money loans

Most of these loans have a timeline of about 12 months, but sometimes they can even be shorter for around 6 months. The shorter-term loans usually occur when dealing with single residential properties. Some loan terms can be longer, ranging anywhere between 2 to 5 years when it comes to commercial renovations.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

How to Evaluate if Commercial Hard Money Loans Are the Right Option for You

The more research and education you receive on commercial hard money loans, the more benefits you will see from it. It is important to always have a clear understanding and plenty of communication throughout the entire process so you know exactly what is going on.

Retipster really defined it best, commercial hard money loans are just short term loans secured by real estate and funded by private lenders instead of banks or credit union. Most of these loans are for around a 12-month period but sometimes these loans can have an extension of anywhere between 2 to 5 years. The value of the property usually plays a large role when it comes to the time length of the loan along with the amount of the loan.

The borrower’s credit score doesn’t weigh heavily on the approval of commercial hard money loans. Most loans require an excellent credit score and impressive cash flow. But commercial hard money lenders are more focused on collateral which includes the value of the property. This is helpful for borrowers who may not meet the strict requirements that most banks and credit union set.

It doesn’t matter if your property is land, industrial, residential or commercial. Any property can be used for a borrower to get this type of loan. Keep in mind that there are some lenders that will only focus on specific types of property, it just depends on what they have the most experience in. It is best to be clear and upfront with what you are looking for at the beginning of the process to avoid any misunderstandings.

Most of the benefits from obtaining commercial hard money loans outweighs the extra cost

Commercial hard money loans are not only faster, they also have less requirements. But they usually come with a higher price tag because of it. Even though interest rates and fees will vary based on certain factors like the region you are in, expect to be paying much more with these loans. These types of loans are much riskier, so the interest rate will range between 10 to 15%, which is usually much higher than most conventional loans.

Commercial hard money loans are easier to obtain, but there are still some eligibility requirements

These types of loans may not have strict guidelines like the banks do, but there are some needs that need to be met. Remember that the focus is usually only on collateral and not the credit rating or cash flow. Even if there’s a record on foreclosures in the past, they could be overlooked if you are willing to pay more in interest rates and fees. Designing a plan for the property is important because you want to show a plan for long-term goals to be able to provide improvement to impress investors.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Be Prepared and Know All of Those Expectations When Looking at Commercial Mortgages

Just like with every big financial decision, when applying for commercial mortgages, it can be very scary, intimidating and stressful. But the more research you do and the more you know, the more likely that your applications efforts will be successful.

The whole process when it comes to applying for commercial mortgages is obviously less than thrilling and actually dreaded by many. But you can take all of the agony out of the process by being prepared and knowing what to expect. First, it is good to know what a letter of interest from a lender is. Remember, it is not always a commitment like you think it maybe. It is actually just a letter listing the terms of the deal. These terms can change until finalized. At first, the letter of interest is usually very simple with just a small amount of information for both parties to review.

But adjustments to a letter of interest is sometimes necessary. Most of the time, these changes usually include adjustments that are part of the final terms. These adjustments could go either way and could negatively or positively impact the borrower. So, that is why it is so important to always keep the line of communication wide open during the entire process and to know where everything stands throughout the application period.

Also, keep in mind that commercial mortgages will most likely take a lot longer to process compared to residential. The expected time frame for an application from the time of approval to closing time is around six or twelve weeks. When it comes to a residential loan, those usually only take half the time range, taking anywhere from three to six weeks from application approval to close. But it is important to keep in mind that many variables will play a part in the timeline.

Know that lenders are there when you need them for commercial mortgages, but they can’t control the actions of third parties that they may work with

It isn’t uncommon for lenders to use third-party companies to complete reports during the entire process. But keep in mind that the revelations or opinions that are provided in these reports by the third parties is completely out of the lenders control. The third parties usually will have a time frame that the reports need to be completed in, but again, as long as they’re done in that specified time frame, lenders have no say in the amount of time it takes for them to process these reports.

The commercial mortgages application process doesn’t have too many differences compared to other loan applications

It is best to stay calm and try to not be too scared when it comes to applying for commercial mortgages. The application process is actually very similar to other loan processes, so don’t stress too much. Just make sure to do your research and know what you are doing before making any final decisions. Also keep an open communication line at all times so you know what to expect throughout the whole process.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

The Benefits and Things to Consider When It Comes to Commercial Mortgages

There might not be too many reasons for commercial mortgages, but there are many advantages to using them. Mortgages can be used for buying land, developing new properties or even extending renovations on current premises.

Commercial mortgages are given many different repayment options to borrowers. These types of mortgages often come with much lower interest rates along with several different options for choosing fixed monthly payments. This will help you get more of an idea and give you more certainty on how to forecast your financial future because you will know what to expect to pay each month. This can become very helpful when planning your long-term financial goals.

Fixed monthly payments can really help you when it comes to preparing for your future financial and business plans. Usually these fixed monthly payments last for quite a few years so you will be able to focus on more important aspects with your business instead of having to worry about payment fluctuations.

Also keep in mind that commercial mortgages can be used as great potential for capital growth and monetary gains. Since property values only continue to rise, it is smart to look at some of these properties for long term investments. There happens to be a lot of investment opportunities for some properties at the moment and if the property values continue to increase, then now is the time to invest.

But still beware of some disadvantages when it comes to commercial mortgages

It may sound like a good idea to time, but commercial mortgages might not always work for you and your business goals. Don’t just take a deal because it is a good deal. Lower interest rates are always a good sign, but many times a lower interest rate may require a hefty deposit. This means that a substantial amount of money needs to be used to be put down on the property. Also, when owning a property, then you are the one responsible for the general upkeep, any security that is needed and also any maintenance that is required.

For your commercial mortgages to be successful, you need to pay attention and continuously converse

There are many factors that you want to consider before making any financial decisions. Also, be sure to be well aware of your repayment options and pay attention to the interest rates along with any higher deposits that may be required. It is important to keep in mind that you are now responsible for the upkeep of the property to maintain or even increase its property value. It may seem like a lot of work at first, but if executed right, all of the work will lead to a large investment opportunity.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Thursday, October 26, 2017

The Main Differences Between Bank Lenders and Commercial Hard Money Lenders

If you are looking for a helping hand with your finances, keep in mind the main differences between bank lenders and commercial hard money lenders. As always, make sure you’re fully educated and have done enough research about the entire loan process before ever making any final financial decisions.

First, we should explain exactly what commercial hard money lenders do. As stated in Arixacapital, they are an investor who makes loans that are secured by real estate. Often times you will be paying higher rates with these types of loans compared to a loan from a conventional bank. But there are some benefits to keep in mind that do outweigh the extra costs.

It is important to remember that these lenders may require a much higher rate compared to banks, but they also usually require much less documentation for approval. Also, compared to banks they have fewer approval requirements and are mostly only focused on collateral as part of the loan deal. This is a little different than what you are probably used to since an excellent credit score and documentation of cash flow is needed for approval from most traditional banks. But in these cases, collateral is more important with these lenders.

When dealing with banks, it can take a long time to get approval. The process takes a longer time when dealing with banks because banks not only consider collateral for approval but also requires proof of excellent cash flow along with an excellent credit score. When not dealing with banks, you can usually get your loan approved much faster because they only need to assess a few pieces of documentation and a few variables like collateral.

When investors are on the verge of a deal and need to get help quickly, commercial hard money lenders are there when you need them

So, what exactly is the point of commercial hard money lenders? Sometimes when it comes to time, real estate investors need to get a deal done rather quickly and want a speedy place they can go when meeting a real estate loan deadline on-the-fly. They may have to pay extra for this speedy service, especially when it comes to the interest rate, but they are paying extra to save time.

Using commercial hard money lenders instead of using banking lenders has its many benefits

You might have to pay more, but it makes sense to use commercial hard money lenders for many reasons. Banks can’t always get the job done in time and if you need to meet a quick approval deadline, this is the way to do it. Great investment opportunities may not always have the financial strength to get approval from banks or they may not be able to get additional on an already existing baseline credit. Plus, if it is allowed, larger amounts of loans are more likely to get approved this way.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Wednesday, October 25, 2017

Why, why did you wait till the last minute to call me for help?

It’s happened all the time.

Every Friday, just before I’m ready to go home the phone rings.

On the other end is a frantic home owner who desperately needs to refinance their loan.

They say “Now. I mean NOW! “ Why I ask.

They say “because we are in foreclosure and the sale
is set for Monday at 10AM.”

You mean like next Monday, in 3 days?

Now what do we do?

I tell the owner they have a few options that I can think of:

Start packing dude, you are going to be moving.
Call an attorney and explore the options of bankruptcy.
Sign a deed over to us and we will pay off the existing note Monday at 9 AM and the home owner (now the ex-home owner) can stay in the home. (To be honest, I’ve never done this.)
Get a new loan, pay off the existing loan and stay in the home.

They usually go for Option 4 – a new loan. (Dude, you dummy, that’s why I’m calling YOU!)

The big problem is that there is not enough time to get the deal done.

We cannot move fast enough, and I’ve have learned that you should never do a deal until you have a preliminary title report and a commitment for title insurance.

But overall the real big problem with option 4 is that:
I have a hard time getting you a new loan when
you have not made good on the current loan.

I say, “How can I expect you to make the new payments when you
did not make the current payments? I’ll be the next person doing a foreclosure.”

I usually hear F*** You , and they hang up.

Sometimes they go into a long explanation of how it’s not their fault, and so and so caused them to not make the payments. Usually it’s an ex something or other that caused the problem, or some other hard to understand why explanation as to the reason they did not make the payments. Never do they admit it was their own fault; it’s always someone else’s fault.

I just don’t know what to tell these callers when they call. Do you have any ideas?

Maybe I should keep some boxes in my office and they can come and get them?

Anyway, there is going to be a home for sale on the court room steps Monday at 10AM.

Maybe I’ll get a call from the lucky buyer and get them a Fix/Flip loan. Yeah that’s it. That will work!

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 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

My mother said to keep my mouth shut and don’t cause problems.

At the men’s bible study on Friday someone ask why I looked depressed.

I told them I was frustrated, and what I did for a living and how the job was going.

They asked what was causing all of the frustration, and seemed very concerned about my wellbeing and wanted to reach out and help. How can we help? You know, we a small group and we help one another!

I said it was because a lot of conversations I’ve had with potential borrowers resulted in them having a poor credit score and I could not help them.

Then I made this comment:

As Christians we should all have 800+ FICO Scores.
We’re not good Christians if we have poor credit scores.

Man that was a big mistake to say that!
Why did I not just keep my mouth shut?

It appears that a lot of Christians have poor credit scores. The exact opposite of what I thought.

And, man, dude did I just piss off a lot of men in the group and now they were all out to get me!

Oh no! Big mistake, so I started to back pedal and try to recover from this blunder and defuse the issue, but of course being the dummy I am, I opened my mouth and I made my second biggest stupid comment.

Well, true, Credit Score is an indication of credit worthiness but
really the score is an indication of you integrity,
and your character and tells the world
the type of person you really are!

Did it again, why did I open my mount?

For the next 40 minutes, the men’s group went from a group of caring, loving individuals that wanted to help me, to a group that was now out to get me!

We even went “past the time for the meeting”, and now the men were into overtime, in grinding me down. Double overtime!

All I saw was red faces, red eyes and I even thought that one person was going to jump over the table and attack.

Ok it was time to bail, head for the door before it was too late, but the men followed me to the parking lot and to the car and wow get out-ta-there dude!

But it did not end there.

Later that day one of the men came to my office and was ready to confront me again.
At least that is what I thought when he walked into my office. Call Security NOW!

But that was not the case.

He came and told me that I was correct in my comment and felt sorry that the ‘bible study’ turned in to this bad situation.

I asked why “didn’t you stand up and help me out?”

He said “I’m not that stupid to open my month and make
that comment to a bunch of Christians with bad credit”.

One smart dude!

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 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: credit score,christians credit score

Wednesday, October 18, 2017

How to Prepare for Commercial Mortgages

There are many steps that you need to take before you begin your search for commercial mortgages. Following a well thought out plan can make your process less stressful and much more successful.

As you prepare to purchase a commercial property there are many steps that you should follow before you submit your loan application. Securing commercial mortgages can take a long time and errors during the process will only make it take longer. But having a strategic plan to follow will help you to avoid any issues that will add more time to the already lengthy process. Your first goal should be learning about the process associated with commercial mortgages including the application process and requirements, the approval process and the terms that you will have outlined in your loan agreement. The more knowledge you have the less difficult and stressful the process will become.

Part of your research will entail learning about the potential lenders that you could be doing business with. Because commercial mortgages are so large and sometimes difficult to secure, many borrowers look at the lender as some larger than life entity. This perspective can make then seem very intimidating. But you need to view the lender as a strategic partner or supplier and nothing more. They are providing you with a service, a loan, and you are simply doing business with them. In a way they should be catering to you as you are their potential client. Fear or intimidation is never useful. Simple professionalism and respect are all that is required to begin to build a successful, professional relationship with a lender.

Going one step further, as you speak to prospective lenders, be honest with them about the financial health of your business and also about your personal finances. Giving them accurate information will allow them to provide you with the most helpful and useful information as you begin to evaluate who might be your best choice as a lending partner.

Invest Your Time in the Process

Understand that as you are getting to know the lenders, they are also getting to know you. In many cases, especially with a first commercial loan request, lenders need to gather a great deal of information. Your business might not have a long financial history so the lender will be basing a large part of the decision on you as the owner. That means that the lender will want to learn more about you than what the numbers on your financial statements can tell them. Don’t be afraid to tell your story and explain why you started your business, how you have managed to grow it to a point where you are looking to purchase a commercial property and what your goals are for the future.

More than Just an Application

It is important for you to remember that there is much more to securing a commercial loan than just successfully completing the loan application. This is a very important step for your business and one that you should prepare for carefully. Having a good understanding of the process and what you need to demonstrate to qualify for a loan will ensure that you are successful in finding the right lender and the best loan to meet your needs.

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 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

Learn To Be A Fix and Flip Investor

Featured Post

The Big Show is Coming to Town.

Monday, October 30, 2017

Commercial Loans In Texas – What You Need To Know About Working With the SBA-Part 1 - Benefits

While there are many sources of commercial loans in booming economies, like that of Texas, many small business owners often turn to the Small Business Administration (SBA) for their lending needs. Even though many small business owners find lots of helps with the SBA, there is a lot to the process.

How can I use the benefits to my advantage if I am looking for a commercial loan to expand my business in Texas?

Things to Consider When Looking to Apply for Commercial Hard Money Loans

Commercial hard money loans can lend a helping hand when a borrower needs a quick loan. It is still always helpful to do plenty of research and know the best ways to approach this process from the beginning of the application to closing.

Using lenders for commercial hard money loans are there when you need them but at a hefty cost

Know the eligibility time of your commercial hard money loans

How to Evaluate if Commercial Hard Money Loans Are the Right Option for You

The more research and education you receive on commercial hard money loans, the more benefits you will see from it. It is important to always have a clear understanding and plenty of communication throughout the entire process so you know exactly what is going on.

Most of the benefits from obtaining commercial hard money loans outweighs the extra cost

Commercial hard money loans are easier to obtain, but there are still some eligibility requirements

Be Prepared and Know All of Those Expectations When Looking at Commercial Mortgages

Just like with every big financial decision, when applying for commercial mortgages, it can be very scary, intimidating and stressful. But the more research you do and the more you know, the more likely that your applications efforts will be successful.

Know that lenders are there when you need them for commercial mortgages, but they can’t control the actions of third parties that they may work with

The commercial mortgages application process doesn’t have too many differences compared to other loan applications

The Benefits and Things to Consider When It Comes to Commercial Mortgages

There might not be too many reasons for commercial mortgages, but there are many advantages to using them. Mortgages can be used for buying land, developing new properties or even extending renovations on current premises.

But still beware of some disadvantages when it comes to commercial mortgages

For your commercial mortgages to be successful, you need to pay attention and continuously converse

Thursday, October 26, 2017

The Main Differences Between Bank Lenders and Commercial Hard Money Lenders

When investors are on the verge of a deal and need to get help quickly, commercial hard money lenders are there when you need them

Using commercial hard money lenders instead of using banking lenders has its many benefits

Wednesday, October 25, 2017

Why, why did you wait till the last minute to call me for help?

My mother said to keep my mouth shut and don’t cause problems.

Wednesday, October 18, 2017

How to Prepare for Commercial Mortgages

There are many steps that you need to take before you begin your search for commercial mortgages. Following a well thought out plan can make your process less stressful and much more successful.

Invest Your Time in the Process

More than Just an Application

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