Learn To Be A Fix & Flip Investor

Saturday, April 14, 2018

Commercial Real Estate Loan Rates

Do you have an office building, a rehab, or a multi-unit apartment building? With commercial real estate loan rates at one of their lowest, now may be the right time to consider a loan for your next real estate investment.

If you are an owner or looking to purchase a commercial property, there’s good news to be had: Commercial loan rates remain at an all-time low. With the Federal Reserve promising four rate hikes this year, this may not be so in the future. For this reason, this may be the perfect time for you to purchase or refinance a commercial property. Level 4 Funding has the team that can help guide you through the process and help you feel like a well-informed purchaser. Let’s take a look at how commercial real estate loan rates work and the interest rates the different types of lenders charge.

If your Credit Score is 680, you’ve been in business in 2-plus years, and plan on occupying 51% of the building, you may qualify for a SBA 7 (a) loan. If your project is between $2 and $3 million dollars you may want to explore the opportunities for financing from insurance companies and conduit lenders.

Commercial Real Estate loans have lower interest rates because they are collateralized by the commercial property. There are four factors that affect the interest rates for the Commercial loan. They are:

1) The Business and Customer creditworthiness: Your rate will be determined by the credit score of the customer and business, the higher credit score the lower rate.

2) Is the commercial real estate loan fixed or variable? A fixed rate loan is a loan that has a fixed rate for the term of the loan. The variable rate loan is reset from 1 to 5 years and will be adjusted based on current rates. Most people will not qualify for fixed rates.

3) What is the term and size of the loan? Hard money lenders offer loans with higher rates and shorter terms while conventional lenders offer longer loans with lower rates.

4) Prevailing Market Rates: Interest rates move up and down based on the government bond market. Keep informed about the movement in the government bond market and how they will affect your rate.

The Lender Has the Biggest Impact on your Rate

1) SBA loans--rates run 4.75% to 9.25%, the 504 loans are best for loans over $1, 000,000 and come in three parts: 50% from the bank, 40% from the SBA and 10% from the borrower. You will need a credit score of 680+.

2) Hard Money Loans--Rate run 10% to 18% and covers about 20% of the market. The rates are high because the loan is not based on the credit worthiness of the borrower but the value of the property. The loan-to-value runs around 55% for many hard money lenders.

3) Other Lenders--Only a small amount of loans come from Insurance companies and Conduits.

Commercial loans can be structured in three ways: fully amortized loans, interest rates resets, and balloon payments.

You may want to purchase commercial Real Estate or refinance a commercial property. There are wide varieties available for high credit scores and lower credit scores. Call and counsel with Level 4 Funding to find what works best for you in your situation. We offer rates as low as 7.99 percent.

Thursday, April 12, 2018

Alternative Business Loans Arizona Entrepreneurs Best Option

Exploring alternative business loans, Arizona start up and small business owners could be surprised by their options. There are many reasons that an alternative loan could be your best choice.

Traditionally, when a business owner needs money to fund a startup or to grow a fledgling business, the first stop is their local bank. But there can be many hurdles to overcome when seeking a loan from a traditional lender. Alternative lenders provide business loans Arizona small business owners actually have a chance of securing and that is just one of the many benefits that they offer.

There are two main benefits to working with an alternative lender. The first is that the approval rates are much higher than a traditional lenders and the second is the fast approval and funding time frame. As an independent entity, there is not the mile of red tape to slog through with most alternative resources so borrowers enjoy a much better customer service experience for the most part and a higher success rate.

When alternative lenders offer business loans, Arizona borrowers will discover that the lenders tend to be more flexible on terms as well as qualifications for the loans. Alternative loans are therefore a good option for a business looking to finance inventory or for working capital which is not something that banks will approve. In addition, the alternative lender is not as likely to require that the business owner use personal assets as collateral for the loan. Which offers the borrowers more confidence in the lender and personal security as well.

Personal Credit is Not an Issue

Poor personal credit is often a factor that will derail business loans Arizona business owners are seeking. Banks are not willing to process a business loan without a deep dive into the personal financial status of the company owners and even some of the other major officers of the company. That is not an issue for alternative lenders as they are primarily interested in the merits of the business and not the owner’s personal finances.

Time is On Your Side

Anyone who has applied for any type of loan from a bank knows that the process can be long and arduous. A personal mortgage loan can take weeks to process. But a business loan application can actually drag out for more than three months. By the time a bank is willing to fund a business loan, the need for the money could be gone, the opportunity could be lost and the business could even be floundering. Business deals are often time sensitive, but traditional lenders tend to overlook that fact. Great opportunities to grow a business don’t appear every day, so business owners need to be prepared to act when the opportunity arises. Securing a loan from an alternative lender is a great way for an Arizona business owner to maximize an opportunity to expand, diversify or land a huge client that might otherwise have gotten away.

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

Tuesday, April 10, 2018

Important Considerations when Choosing a Hard Money Lender

Hard money lenders are many real estate investors choice for funding, yet many just getting into the field know little to nothing about this lending option. Let’s take a look at what this type of lender can bring to the table.

Hard money lenders are not held by the same regulations that banks and credit unions must operate under. Because of this, they can offer loans to individuals and businesses with less than stellar credit. Many are private individuals who specialize in several types of real estate investment strategies from multifamily to office to the fix-and-flip model. These types of loans are asset based, meaning that the lender will look at your collateral as the prominent element of the loan. These types of loans are good for investors just getting in to the real estate investment model.

Another positive to those that operate under less regulation is that they are much quicker to funding. This becomes important when an investor is looking to get into a property, do some quick renovations, raise the property value, and get it on the market or obtain a loan from a traditional lender that is based on the property’s new value. If you end up developing a long-term relation with a hard money lender, you will find that you can often receive the funds you need for that next investment property in as little as a few days, compared to a month or more from other types of lenders.

Be sure to check the small print. Are you working with a hard money lender that offers a no-penalty clause for early payments? A pre-payment penalty states if you pay your loan back in full before the actual due date, a penalty will be assessed. The fee is percentage-based or the amount in interest that you would have paid for a set number of months. This can lead to tens of thousands of dollars. If you have an existing loan with a pre-payment penalty, be sure to assess fees before paying off the loan in full to determine if this is the right strategy for you.

Know Your Exit Strategy

While your property may be acting as collateral, hard money lenders do not want to be in a position of laying claim and having to foreclose on a property due to unpaid debt. For this reason, they will want to know your exit strategy. An exit strategy is how you plan on paying off the debt. Most of these loans are short-term, anywhere from 3 months to five years, making this component an important consideration for both the lender and the borrower. A few options are to refinance with a commercial mortgage, renovate and sell, or pay the debt off with business capital.

Know your exit strategy before considering a hard money lender. Going in with strong collateral and a good exit strategy are keys when considering going after a hard money loan.

At Level 4 Funding, we work with hundreds of private hard money lenders. Our rates start as low as 7.99 percent with terms that run anywhere from 3 months to 5 years. Call us to see if we are the right brokers for your next real estate investment deal.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Saturday, April 7, 2018

The Difference in Hard Money Loans

Many people, before they delve into the world of real estate investments, think of hard money loans as those you obtain only if you have poor credit and are desperate. Those that have been in the business for a while understand that they are an important lender to have in your lending portfolio and that many have different requirements and protocol.

Hard money loans are often obtained from private individuals that specialize in various types of real estate loans. The rates they offer vary dramatically and can range anywhere from 10 percent and 1- or 2-point origination fees, depending on your terms, to 18 percent interest on a short term loan with a 5- percent origination fee. An origination fee is designed to cover the cost of entering into and processing the loan agreement. Some lenders will roll your origination fee into the loan balance while others require payment upfront. Compare loan APRs along with fees in order to determine who is offering you the best loan.

You’ll find underwriting processes, or loan determinations, very different among lenders of hard money loans. For many, creditworthiness and credit scores are not even considered in the approval process. For others, it is an important consideration. When evaluating what you bring to the table, which includes your down payment as well as your collateral, some will only consider the LTV or loan-to-value ratio while others consider the ARV or after-repair-value. If you’re looking for a loan amount based on the after-value, you will need to come to the table with a solid background in your chosen real estate investment as well as budget and expenses that includes contractor fees.

Some hard money lenders specialize in specific types of properties. For instance, you will find hard money loans specifically for fix-and-flip models while others are solely investing in manufactured homes with land. Obviously, it’s important to find out what types of investments they are willing to loan on before wasting any time with a lender that does not specialize in the type of loan that you need. Generally speaking, most will not lend on an owner-occupied residential property thanks to Dodd-Frank regulations.

The Main Reason Real Estate Investors Choose Hard Money Loans

One of the main reasons real estate investors choose hard money loans is because they are often quick to fund. Many of these types of lenders will fund in as little as a week or less, in comparison to the month or two that traditional lenders take due to underwriting processes and extended time to funding. If an investor finds themselves in a bidding war, having cash on hand can often mean the difference between starting their next renovation or still searching for that ideal property.

At Level 4 funding, we provide funding for all types of real estate investments including multifamily, construction, business and office.

We offer loans with no prepayment penalties and with terms that can be extended. Our popular construction loans start at 9.5 percent APR with 24-month terms and convenient monthly draws. Call us for a no-obligation quote.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Wednesday, April 4, 2018

Real Estate Values Are Continuing to Climb Up to Record Levels Again! You’re Making Moola Again!

Technorati Tags: Private Hard Money lender,fix and flip,hard money lender

With a booming economy and a strong GDP coupled with low
interest rates, home values in the South West are marching to
new record highs. Southern California home values are approaching
the boom prices that last occurred in 2006. Many home owners
are selling their homes within days, and the demand is continuing.
Some home owners are receiving multiple offers and builders are
experiencing very strong demand. Although the demand is not as
it was in 2006, with home builders using a lottery system to pick the
buyers and buyers camping at the sales office for days, there has
been a steady increase in demand.

Las Vegas had the biggest dramatic swing in prices. From the
peak in 2006 to the bottom in 2002 sellers were getting out of their
homes by the 1,000’s. However, over the past 5 years prices have
increased an average of 14%/year with the last 12 month's average around 12%.
San Francisco is the hottest market with prices rising like a rocket and demand
is at a very hot pace.

Over the past 5 years San Francisco price increased a
whopping 15%/year. However the past 12 months have slowed
a little with an appreciation of 10%.

(For a PDF of this Graph Click Here)

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC

310-756-8418 or 818-404-6208 Lew Stone Danger Beware Danger 3107568418 8184046208

Got a strange call from 'Lew Stone'.

Seemed like a crank call and was not very nice on the the phone.

Was rude and disconnected without any courtesy or professionalism.

My recommendation is that if you get a call from this dude "LEW STONE"

Is that you do not call him back or work with him.

Block "LEW STONE" on your phone.

Danger Beware Danger

Dont Know if the "LEW STONE" is the correct name.

310-756-8418 or 818-404-6208 Lew Stone

Tuesday, April 3, 2018

When is the right time to cut your losses in the real estate business?

The real estate industry can be extremely tumultuous under normal conditions. If you are doing it correctly, you will run into a few extra problems that come with investing. What separates the inexperienced investor from the pro is knowing when to throw in the towel. Now, we are not saying that as soon as you find a water leak in your property you should give up, but you need to be aware of your investment as all times.

For many investors, this means having a solid exit strategy before you are able to commit to a new project. A solid exit strategy allows you to drop one project and go after another within a few days. For some investors, this could be after a certain number of repairs exceed their comfort level. Along the lines of property renovation, an investor could have a financial cap set in place before they decide to pull out on their investment.

Research makes perfect in real estate

An experienced real estate investor takes their time to thoroughly vet a property and the geographic area before making an offer. They will most likely go through an extensive checklist before making a decision. Sometimes hard money lenders in Texas are able to help you with your research, however, most of the legwork is up to you.

Enough research can tell you the right amount of money you should put into the property. Often many investors bite off more than expected with a property. In the event that the repairs begin to outweigh the possible revenue that you are expecting you should begin implementing your exit strategy.

When is time to step away from your investment?

The moment you feel as though you are not going to make any profit on the property is the time you step away. Some investors will tell you to stick it out a little longer, while most will tell you to stick with it. In the long run, you must do what is right for you. Maybe you have expended all the money you set aside for the project.

Most of the time at this point other investors will not want to or be able to help you in your investment. One of the most important details that you want to remember about real estate is timing. Your timing is everything.

Say you ask your hard money lender in Texas for an additional loan from more construction, however, recently there has been a decline in the demand for homes. Now, you have a home that may not sell for the next two or three months. With a hard money lender, usually you will have a fairly short term loans this will not work.

With an exit strategy, you give yourself more options

Allowing yourself to leave your investment if you need to, till ultimately save you thousands of dollars in the end. It may seem like a loss at first, but a loss will hurt much worse if you are left with debt.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Monday, April 2, 2018

How to Obtain a Commercial Loan Despite Bad Credit

While commercial lending rates are up, there are still many individuals and businesses that are finding it difficult to obtain the commercial loan they need. Fortunately, there are lenders that offer greater flexibility.

In 2017, small banks approved 49 percent of funding requests—quite a jump from 2008 when about 80 percent of small business owners received a rejection. That still leaves over 50 percent that are not getting approved and you may have found yourself one of these. Don’t give up on your dreams. There are other lenders that you can turn to when banks say no.

Hard money lenders are one of these options. They are usually private lenders that base their loan qualification standards on the collateral or assets of the property or business. While most banks require credit scores in the 700 range, private hard money lenders do not have these strict qualifications. They will want to know what your plan is for the business or property and what your exit strategy is. After all, this is how they will receive their capital as most offer interest-only payments for a set amount of time. These lenders offer short-term loans with terms that usually extend from 3 months to 3 years. Because they approve loans that have been declined by traditional lenders, there is usually an increase in risk and, therefore, a higher percentage rate often applies to the commercial loan.

These types of loans are helpful for young or new entrepreneurs who may not have the credit score required by traditional lenders. If you have a high-risk, high-return business strategy, a hard money lender may very well have the capital you seek. Many of these types of lenders are not risk adverse. In fact, if you can get them excited about your proposed business plan, have the necessary collateral, and some experience in your chosen segment, chances are good that you will leave with a loan. This doesn’t necessarily mean that all the required assets must come from the proposed business. Many individuals start their own business by using the collateral that has been established in their home or other investment properties.

What are Possible Exit Strategies in a Hard Money Commercial Loan?

Your exit strategy is an important part of obtaining this type of loan and one that you will want to consider before interviewing potential lenders. Here are a few of the strategies that businesses use: they sell the property or refinance with a more traditional lender after a property has been renovated or a business is showing a profit. Self-amortizing can also be considered, though it is a little risky. While most hard money lenders allow you to pay interest-only payments while you are developing your business or property, you may want to consider paying both principal and interest during the full duration of your loan so that it is paid off upon maturity. You will need to determine just how you will create this cash flow in order to be able to make the scheduled payments.

At Level 4 Funding, we offer hard money commercial loans that are quick to funding and require little paper work.

We offer three simple steps to obtaining your loan: a loan application, purchase contract and written approval, all of which can be accomplished in as little as 24 hours. Call us today to see if we may just be the lender that can make your dreams come true.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

How to evaluate Commercial Real Estate Loans

There are many commercial real estate loan companies. How do you tell the good from the bad and the ugly?

Commercial real estate loan rates were ridiculously low until recently when rates started moving up. The ten-year government note has moved from 1.44% on January 1, 2018 to over 2.85% on Friday, January 9, 2018, with projections up to over 3%, 3.5% and 4% in the next 60 days. You most likely will not see current rates this low again in your lifetime. Commercial loans are at these low rates because commercial real estate loan companies are sitting on an ocean of cash, nearly $2 trillion dollars. Commercial investors still feel hesitant, however, to overextend with loans from the shock they experienced by the recession of 2008.

So just which commercial loan is best for you? A life Insurance company, a conduit, a credit union, an SBA lender, a commercial bank, a USDA Business and industries lender or even a hard money commercial lender? A life insurance company offers the most attractive commercial interest rates that are only 0.35% to 0.50% higher than the prime residential mortgage rates. Be aware, few life insurance companies will touch commercial projects smaller than $5 million. The project must be very standard and cannot be older than 20 years.

The next avenue which is available is a CMBS where commercial real estate loan rates are 50 to 65 basis points over the prime residential mortgage rate. For projects between $3 to $5 million and up, a conduit may be an appropriate choice for you. They will also finance older properties. For projects with good credit principals, banks and credit unions may be a good option. The rates run typically 0.75% to 1.50% over prime, 30 residential mortgage rates.

SBA and USDA Loans

SBA, if you qualify, should be considered first. The standard 7a SBA loan is 2.75% over prime floating. With the SBA you can quality for a 90% loan-to-value and the loan is fully amortized over 25 years. You must have a credit score of 700-plus and financials for the last several years. The USDA loan is less attractive. The loans are made through banks and guaranteed by the USDA and they are similar to SBA loans--2.75% over floating prime and fully amortized over 25 years. These properties must be located in eligible rural areas in order to qualify.

Although an effort has been made to quote current rates, this is a fluid market and, as pointed out, rates have increased since the first of the year and are fluctuating.

Once underwritten, residential mortgage companies can sell the mortgage to Fannie Mae or Freddie Mac. The illiquidity of the commercial market, since they do not have an agency to sell their underwritten mortgages to and these types of loans are seen as higher risk, results in commercial mortgages 0.35% to 1.50% higher. Before applying, you need to get all your ducks in a row including property type, projected cash flow, age of property and projected operating expenses. For many real estate investors who require quick capital for their next project, a hard money loan is the answer. Call us at Level 4 Funding for a no-obligation quote.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

The Top Differences to Watch for with Private Hard Money Lenders

While there are over 600 private hard money lenders in the U.S., no two are created equal. Understand the differences and what to look for when choosing a lender for your next project.

Looking for a short-term loan quickly? Need 7 to 10 days? Looking to purchase residential and commercial property for purchase and renovation? Obtaining quick capital via a private hard money lender may be your best option. In fact, this is one of the primary forms of financing for first-time real estate investors. Let’s take a look at what are the marked differences among the various lenders.

Some private hard money lenders focus on properties in relatively good condition, while others will fund properties in poor condition if you come aboard with a good business plan and the numbers to back it up. This includes an in-depth look at renovation costs, time frame, and market. You will also need to include the monthly costs that you’ll incur during the renovation process such as utilities, insurance, loan interest and property tax. Some companies and private investors loan only on the LTV or loan-to-value, while others will consider the ARV or after-repair-value. For instance, some will issue a loan up to 80 percent of the LTV or 70 percent of the ARV. If your model is to rehab properties in poor condition for a fix & flip, you’ll want to be sure to ask your potential investor which value they consider when funding a project.

Buy-and-hold investors, on the other hand, obtain private hard money lenders in order to ensure quick capital. After renovation is complete, they look to more traditional loans for longer terms and lower interest rates. You’ll find many private investors that specialize in one segment of real estate. For instance, there are hard money lenders that invest only in the office or multifamily segments, while others focus on the fix-and-flip model. You’ll want to be sure to find one that is comfortable and knowledgeable in your area. There are even hard money lenders that fund residential loans. These are, in most cases, considered bridge loans—short term loans that bridge from one property to another such as when home owners buy a new home before their old home sells.

Interest Rates and Average Lender Fees

Going into this arena of commercial lending, it’s important to be aware that the interest rates are going to be higher than conventional mortgages because the hard money loans are shorter terms, interest-only payments, and increased risk for lenders. The interest payments are considered “holding costs” and are monthly fees incurred prior to selling or refinancing. These interest-only payments result in lower monthly payments. When you agree to a loan with a hard money lender, there can also be what are known as “loan origination fees” or “points.” Additional fees that the borrower may be required to pay include closing costs, appraisal costs, application fees, prepayment penalties and loan extension penalties.

At Level 4 Funding, we offer loans from 7.99 percent APR with 90 percent LTV.

In addition, we do not charge prepayment penalties and can often fund within days. Because we work with hundreds of private investors, we can usually find an investor in your niche who can offer you the best terms and rates for your project. Call us today for a no-obligation quote.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

How to Find your Next Big (and Cheap) Project and Commercial Loan

One of the many ways real estate investors make money is by finding properties that are below market value. Let’s take a look at the many avenues savvy investors look to when searching for these types of projects and the commercial loans to fund them.

In order to make money in this often lucrative, though challenging, investment strategy known as real estate, you must be patient. I know, you’ve ran into those multimillionaire real estate developers that seem to be flying at 100 miles per hour, without brakes, and whom patience is definitely not a virtue. I can guarantee you, however, that behind the scenes is someone with an analytical mind that exhaustively researches the next property for development.

In order to really make the big bucks, you’ll need to find property that is below market value—a prospect that is actually easier than it sounds. In order to buy a property below the market value, you’ll need to know just what the market value is. One of the best ways is to get to know a real estate agent in your market area and develop a good, solid business relation. They provide comparative market evaluations daily and will understand the market in a way that no one, just entering the fray, could comprehend. What you don’t want to do is use sites such as Zillow or even tax assessments, which can be way off the mark.

Now that you know what it’s worth, let’s find out where the deals are. Real Estate Owned (REO) properties are a good place to start. These represent properties that have gone through the foreclosure process, are bank-owned, and can be found in the MLS. All banks handle these types of properties differently. Some are willing to negotiate a price that is far below the listed price, while others are less prone to price reductions. There is, however, a lot of competition for these types of properties and multiple offers is not rare. Some prefer owner-occupied homes while others will give cash offers precedence. Foreclosed HUD homes are another alternative. This is a little more difficult because these homes are government owned and, as you can imagine, purchasing one is filled with rules and regulations. Ideally, work with a Realtor who understands the system. These homes can be found on hudhomestore.com.

Short and Estate Sales

Short sales are another avenue to below market values. These are owned by private sellers who owe the bank more than they are able to sell their home or property for. You must be quick with these types of properties because it is often the first offer that the bank accepts. While at one time, these types of properties took months to close on, banks are now quicker in their decision-making process. Estate properties can also be good prospects. These types of properties may need to sell quickly due to creditors, tax issues or family dynamics. Then, of course, there is the “We Buy Ugly Homes” approach that investors undertake to find homes that are not listed for sale. And what will all of these types of properties require? Access to cash or a commercial loan that provides quick funding.

As you can see from these types of search options, most all of them require quick acting and quick capital. So, just where can you find a commercial loan that funds in a matter of days instead of weeks?

At Level 4 Funding, we can provide the hard money commercial loan you need for your next real estate investment project in less than a week. Call us today to see if we can help you purchase your next investment property tomorrow.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Get ready, the Donald is getting ready to SCREW YOU!

iStock_000067965589_XXX small (1) Whoa, are you ready for it? You are going to get screwed! I don’t think the Donald is going to actively go out of his way to cause you harm.

You see his hands are tied, but he has to do something before it is too late.

I don’t know if you have noticed it yet, but there is an ugly monster in the corner of your room, and under your bed who is fast asleep, and quietly taking no action.

Don't believe me? Ask our kids, they will tell you also.

It’s a horrible monster, who when it wakes is going to eat you alive; you, your family, your savings and everything around you.

It’s going to be horrible, like something you and I have never seen.

Luckily the monster is asleep and causing little harm.

BUT the Donald knows it is there lurking in your room.

He’s keeping an eye on it and figuring out a way to KILL IT before it awakes.

Kill it in in its sleep; get it now.

I don’t know if he can, but he’s working on it.

So what’s this monster look like?

It’s the trillions of dollars in debt that is inching up every day.

It’s going to get you!

The Donald said that when it reaches 20 Trillion it’s to longer fixable, past the point of no return. (It’s past 20 Trillion now) It’s beyond the path of control.

It’s going to become a living monster that is going to get us. All of us.

However, the Donald is working on a plan to kill it.

Basically there are three options possible to kill it.

Option 1. The first plan that the Donald is trying to do is what he said in his campaign.

Make America Great again. What does this mean? It means getting our GDP up to historic levels. Not just 3%, but even higher. How about a 10% GDP? When we are booming, our cash flow can kill the monster.

That’s what he is hoping for. Kill it with growth. Make so much money that the trillion of dollars can be paid off with a week’s worth of income.

Possible? I don’t know, but this path is the least painful path, compared to the two other Options that will kill the monster.

Option 2 is to inflate it away.

That’s it. Devalue the dollar to the point that 20 Trillion is nothing. Give everyone a pay check that is 10 times more than they are making today. Prices go up, income goes up, but the debt stays where it is.

This is possible, and the Donald thinks that this could happen. The recent tax plan made sure that your taxes rates were indexed to inflation. Wow, did you see that? If the dollar crashes our effective tax rate stays the same. We will be paying a boat load of money in taxes, but your effective tax rate is not going to go up.

Option 3 is to pay it off.

Good luck with that option.

There is not enough income to pay it off. It would require doubling EVERONES' taxes for the next 10 years and cutting social security and all entitlements out completely. No more handouts anywhere for anything.

Don’t think this is going to happen.

Another option that most politician are taking, is to leave it alone and hope it does not wake up.

But it’s going to wake up.

It's past the point of no return.

The wakeup alarm is ringing and the monster is starting to wake up.

Do you see it in the corner, starting to stretch its ugly muscles?

Its Yawning and scratching its back and with one ugly, mean eye open looking directly at YOU!

It’s going to get you, so get ready!

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

Sunday, April 1, 2018

How to Develop an Exit Strategy When Obtaining a Hard Money Loan

An exit strategy is, in essence, your plan for paying off your hard money loan. It is a plan that you will want to develop before you sit down with a lender.

Exit strategies are crucial for obtaining a hard money loan. Many of these lenders offer interest-only payments as you develop or renovate your project. They obtain the big payoff upon completion when you have succeeded in your “exit strategy” and can repay them in full. For those of you in the fix & flip model, your exit strategy is fairly easy to define. You rehab and then sell the property.

Selling the property, then, is your exit strategy. Because timelines can change in the world of construction and rehab as well as finding qualified buyers, it will be important that you look for a hard money lender that does not charge a prepayment penalty. You’ll also want to come to the table with improvement plans that include costs and potential market value as well as comps and average time on the market.

If your real estate segment falls into the buy-and-hold model, selling will, obviously, not be an appropriate exit strategy. A strategy that does work is refinancing. Many traditional lenders that offer lower interest rates with longer terms will not loan on properties in poor conditions. Once you have the property renovated and a suitable tenant, your chances of obtaining a traditional loan are greatly elevated. It could be that you needed a loan quickly to jump on a property that just hit the market. Many investors obtain funding from their hard money lender in order to accomplish a quick buy and then refinance at a later date.

The Sale of Assets

The sale of other assets such as real estate or accessing additional funds such as money from IRAs, the stock market, or business interests is another exit strategy. You may wonder why, in this case, the borrower wouldn’t just dip into their additional assets and bypass the loan process all together. For many investors, time is a crucial component in their investment strategies and waiting while other assets sell may cause them to miss a prime property or opportunity. In essence, you are obtaining a bridge hard money loan. These types of short-term loans simply “buy some time” and act as a “bridge” from either one loan to the next or one property to the next.

Don’t feel like you have to stick with one exit strategy. Blended strategies can often be the best solution depending on the situation.

And just what is a blended strategy? This type of exit strategy utilizes a combination of all of the above to create a strategy that works the best for your particular situation. For instance, if you cannot obtain the full loan amount upon completion of the project, you can sell an asset and reduce the LTV so that a traditional lender will consider financing. Whatever your exit strategy, be sure to check with Level 4 Funding before obtaining your hard money loan. We have years of experience and can help you develop an exit strategy that works well for your project.

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