Benefits of Unsecured Real-Estate Lines of Credit

Unsecured real-estate lines of credit can offer many benefits to those who can qualify. With an unsecured line you don't risk your personal assets, and you save money over a standard loan. Above all with this type of loan you can close deals without having to wait on a lender, which can give you an edge over your competition.

Some refer to this type of loan as an acquisition line of credit. It allows you to acquire new investment properties without requiring you to pledge your personal or businesses property as collateral. Lenders secure this type of loan based on their perception of your strength as a borrower.

So qualifying for this type of loan will depend on your financial profile, be it your credit score, or the income you earn from your current investment properties. So if you can qualify for an unsecured line, it could be an excellent financing solution.

The main benefit of unsecured real-estate lines of credit is you can leverage your financial situation and strength as a borrower without putting your personal property at risk.

The main advantage of an unsecured line vs. a secured or equity line of credit is that your personal property is not used to secure the debt. Simply put, in the case of an unsecured line of credit, your lender cant repossesses your house should you default. Note that because this type of loan is unsecured, you need to be an exceptionally strong borrower to qualify.

However there are  fewer hassles with unsecured lines of credit, and the overall process can be a lot smoother.  Unsecured lines often come with little in the way of up-front fees, a sparse amount of documentation is needed, and no appraisal is necessary. 

With credit lines, you only spend what you need to and you pay back only what you spend. This aspect of credit lines is a significant advantage over a term loans, where you make interest payments on the full loan amount you borrow and pay back the entire loan amount.

After you qualify for an unsecured line of credit and your loan closes, you receive a lump sum which can then draw from whenever you need. You can make multiple offers on multiple properties using the same line of credit or use the funds to cover any other expenses.

Unsecured real-estate lines of credit offer you flexibility, you don't have to go to a lender every time you want to acquire a new property

Above all, you can spend the proceeds of your credit line at your leisure, and on any property you wish to purchase. With this type of loan, you don't need to apply for a new loan every time you want to make an offer on a property.  You don't need to wait around for your lender to scrutinize the details of your purchase, and you can make a full offer right way.

So if you can qualify an unsecured line of credit could be a great financing solution, which can help you rapidly acquire new properties while at the same time protecting your businesses assets.

 Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC 
Hard Money Lender
Hard Money Loans
Hard Money Loan
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com
Dennis Dahlberg Broker/RI/CEO

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 43 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

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Evaluating your options when it comes to Arizona Investment Property Financing

Evaluating your options when it comes to Arizona Investment Property Financing real estate, you may be overwhelmed by the multitude of Arizona Investment Property financing options available.

The first option you might consider if you want to invest in real-estate is a conventional investment mortgage. An investment mortgage, is the same thing as a regular mortgage expect that it is used to purchase investment properties.

While an investment mortgage offers the lowest rates, the underwriting process takes a long time. In the worst case scenario, the sale of the property you were considering might go through, as you wait on your conventional lender to review reams of financial documents. So, if a conventional investment mortgage is the only financing option you consider, you could miss out on the best deals.

While conventional financing offers the lowest interest rates, these lenders have exceptionally high standards which many new investors may not be able to meet. The main issue comes down to credit, to get the best conventional investment mortgage possible your credit score should be over 700, the minimum is 620. So if your credit score is lower than 620, there is little to no chance you can qualify for an Arizona investment mortgage.

So if you can't qualify for a conventional Arizona Investment Property financing, can you still finance the purchase of an Arizona Investment Property?

Some investors draw equity from their primary residence to finance the purchase of their first Arizona Investment Property,  while others secure loans from crowdfunding websites. Some investors may have friends or family members with deep pockets, who are willing to help and who can finance their first purchase.

Home equity lines of credit, crowdfunding, and personal loans are all options you could consider if you can't qualify for a conventional investment mortgage. However, of course there are drawbacks to consider.

With home equity loans, you put your primary residence at risk if you default. With crowdfunding there are not guarantees your loan will ever be fully funded and borrowing from close friends and family can put a severe strain on your relationships if you run into financial difficulties.

If you can, you should consider hard money which can be an excellent Arizona Investment Property financing option

This type of lender uses the value of the property you aim to purchase as a means to secure the loan. For this reason, hard money providers can look past your financial situation and your personal credit score, making hard money an option if you can't qualify for a conventional investment mortgage.

Unlike home equity loans, with hard money, there is often no need to pledge your primary residence as collateral. Most hard money providers have the funds on hand to fully finance your loan. So with hard money, unlike crowdfunding, there is no need to wait around for your loan to be fully financed. Unlike personal loans, you don’t risk your relationships with hard money.

While hard money is more expensive than other types of financing, it gives you options.

After you purchase your Arizona Investment Property, you can always refinance to a less expensive conventional loan after your financial situation improves.

So if your just getting started in real-estate investment and you can’t qualify elsewhere consider hard money as a potential financing option.

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.

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