Learn To Be A Fix & Flip Investor

Friday, March 29, 2019

Hard Money Facts: What Your LTV Percentage Means

If you’re taking out a Colorado Hard Money Loan you’ll want to understand the LTV and what the percentage attached to your loan means. Here’s a quick rundown to get you in the know.

When you research Colorado Hard Money Loans you’re going to see numbers like 70% LTV and 80% LTV. What does this mean for you as a borrower?

If you’re investing in property the loan amount is going to be weighed against the purchase price and the value of the property. The LTV is the loan to value, meaning the amount of the loan divided by the assessed value of the property.

Another important term to know is ARV. This is the approximate retail value, the amount the lender estimates the property to be worth after it has been improved.

Understanding Your LTV Percentage

Now that you know the key terms you’re going to see lenders offer 70% LTV, 80% LTV, and some, like Level 4 Funding, offering 90% LTV Colorado Hard Money Loans. If you’re purchasing a $200,000 house and want a 90% LTV Colorado Hard Money Loan you’ll be asking to borrow $180,000.

Borrowing more can be riskier, but if you can’t put up more than 10% of the purchase price then a 90% Colorado Hard Money Loan may be the way to go!

How LTV Affects Your Loan

Another thing to consider is the higher the LTV, the higher the interest rates and points. These will vary from lender to lender, but the LTV and percentage rates will climb in tandem. If you can afford to use a lower LTV loan you’ll be paying less over the long run, saving yourself more money for investments.

Getting Your Loan Approved

Once you’ve picked a Colorado hard money lender you’ll have to explain how you’re going to put their money to work. A complete plan of how you’re going to pay the loan back will include your plans for improving the property in order to pay off the loan.

For more questions about calculating your LTV or to discuss being approved for a Colorado Hard Money Loan, call Level 4 Funding today!

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

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 and 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

3 Benefits You Can Expect From a Colorado Bridge Loan

Colorado Bridge Loans can save you in a tight financial situation. Here are three things that you can expect when receiving a Colorado Bridge Loan from a Colorado hard money lender.

Depending on your financial situation and what purchase you want to make, a Colorado Bridge Loan can save you when you need to fund a real estate purchase quickly. Put into simple terms, a Colorado Bridge Loan will give you temporary funds while you’re waiting for permanent financing to come through.

There are many reasons a Colorado Bridge Loan may be needed. Here are three times you would benefit from using a Colorado Bridge Loan:

Purchasing Before Selling

A prime example is to pay for the purchase of a new home while an owner is waiting on their current home to sell. The timeline isn’t always ideal and if you find the perfect home, but haven’t been able to sell your property then a Colorado Bridge Loan is perfect for making that new purchase in the meantime.

This can also free up a homeowner from having to sell their home with a contingency, a requirement that could keep offers from coming in.

Remodeling Before Selling

A homeowner may want to make upgrades to a home before putting it on the market and if the upgrades require the homeowner to move out, a Colorado Bridge Loan would allow the homeowner to move into a new property while completing the upgrades instead of finding temporary housing which can be expensive and inconvenient.

Purchasing Commercial Property

Another example is when an investor wants to purchase a commercial property, but the loan-to-value isn’t high enough or there aren’t enough lessors in the building. Big banks won’t fund a purchase like that due to their stringent requirements so a Colorado hard money lender comes in to offer the capital to fix up the property and then the investor can turn to traditional lending after.

Colorado Bridge Loans can be an alternative to a traditional home equity loan and can be funded by a traditional bank, but when you need the funds quickly the best way to go is a Colorado Bridge Loan. The flexible requirements and repayment could be perfect! Call Level 4 Funding today to learn more!

Residential Arizona Hard Money Lenders: what are the advantages of using these lenders over the traditional ones?

Although not the easiest type of funding to pursue and acquire, these lenders do have some positive assets over the more conventional ones. Why not let your home or office building work doubly hard for you and solve your funding problems?

A residential hard money lender is set up to provide what is termed a non-bankable loan on property already owned by a prospective client—usually a home, be it a single family building, duplex, or another hard form of collateral. While banks and mortgage groups can and do take three to six months to close your loan, the Arizona Hard Money Lenders can ideally do it within the space of a week. They are also less likely to lets a hiccup in your financial history put a halt to the entire process.

Holding a mortgage on another property can hold you up with conventional lenders—your debt to income ratio appears here because the theory is if you already owe money, the less likely you will be able to repay another loan on time if at all. Another rule is that you cannot borrow through a bank on property that is in need of renovation–they are strictly interested in the current value of a property, not what it could be in the future.

Again, a hard money lender can work with you on these as well as the more odd things that could stop you. One being is if the property was used for other purposes than a home before and you are looking to make it into a family residence now, this is yet another point that a hard money lender will be more receptive to.

These are only some of the reasons that while perhaps never entering a would-be borrower’s mind can put an application in danger of rejection from a conventional lender. Private funding organizations and individuals tend to view these areas differently and not necessarily something that would prevent you from receiving funds.

Are these type lenders really worthy of serious consideration?

You may actually save money by using these residential Arizona Hard Money Lenders since they can structure a longer repayment period for the loan than the standard types. The upfront fees and down payments that go with other loans are often not attached to these loans.

They are more interested in your collateral value as opposed to your credit score also while desiring that you have an average of 40 percent equity in your residence at the time.

Find out all you can about loans before making your first appointment with any lender, conventional or otherwise. If you are successful with your project, you will come away with a lot—professional contacts in the business, a growing portfolio and a firm reputation. All of these are good to have when you want to take on a larger project in the future.

Talk to your friends and colleagues who are in the field. Know the pros and cons of working with a residential hard money lender before becoming involved in the process.

Dennis Dahlber Broker Ri CEO Level 4 Funding LLC 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

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.

Don't Count Out Colorado Hard Money Lenders for Your Next Investment

Make sure you have all the facts about Colorado hard money lenders before you make the call on who is going to fund your next investment project.

If you’re familiar with the investment and lending industry then you’re sure to have heard of Colorado hard money lenders, and if we had to guess there have been some negative pieces of information attached to what you’ve learned. Why is that?

In our experience, Colorado hard money lenders get a bad rap because people use them for the wrong reasons. Here are some scenarios where using Colorado hard money lenders might not be beneficial for you.

If You Have Good Credit and Income History

This doesn’t mean that people with good credit and income can’t use Colorado hard money lenders to fund their investment, but it’s especially helpful for those that don’t. If you fit into the first category it may be the right path for you to go through a traditional lender, but if you don’t we can help. We overlook bad credit and get you the money necessary to invest in real estate.

If You’re Looking for a Long-Term Loan

If you’re looking to snag a loan for a long-term investment scenario, Colorado hard money lenders are not the way to go. The higher interest rates can be a deterrent and quick payback times don’t fit the traditional lending mold. However, if you need cash quick and are going to be able to pay it off quickly, it is most definitely your best bet.

If You’re Not Prepared to Flip

Colorado hard money lenders approve their fund disbursements based on a business plan. We need to know where our money is going, what it’s doing, and the likelihood it will be returned. Our strongest clients come to us with a well thought out business plan. That’s not to say that first-time investors won’t get approved, but without the knowledge and skill to make the money work for you, it won’t work for us either.

If you feel that working with Colorado hard money lenders rather than a traditional bank sounds like the way you want to go, we can talk you through the process and discuss your investment opportunity with you. Call Level 4 Funding today to learn more!

What is a Arizona Fix and Flip Loan? Would this odd-sounding type of funding help you out?

(Basically this kind of loan involves a buyer purchasing a home strictly to sell—flip, if you will—as soon as possible. Most of the properties bought are in need of renovation. Once done the house is put on the market and sold, hopefully, at a decent profit to the owner, who then can pay off their loan and still have money in-pocket.)

Arizona Fix and Flip Loans are short-term types and most customers seeking one invest with hard money permitting them to purchase, repair and sell the property over the next year. Since the property is technically appraised before and after a renovation is performed, it is better to deal with private investors and people you already know who can better gage your ability to finish the job once you get funding.

The process takes a lot less time than the conventional lenders who are compelled to go through your credit history with the proverbial fine-toothed comb. One negative item or hole –a foreclosure, for example—will stop the entire effort while they check you out more closely to see if this will adhere to the strict rules they have to work by. Very often you are defined as less than a good risk and back to where you began.

A regular loan looks at a home or other building’s present value, but these types are less expensive in terms of interest and fees than non-conventional loans. A standard funding setup generally requires very good credit while the private funders and groups look towards what you have accomplished in the past and what you are working on currently instead of a high credit score.

Getting funding may be difficult if you are a beginning investor—you may have to set up an escrow account, borrow against personal property or both. An interest rate can range from 10 to 20 percent yearly.

What are some advantages of Arizona Fix and Flip Loans?

These loans are not bound by a lot of the rules that traditional funders are restricted to, such as not lending money if a property has any real health or safety concerns.

The amount of time it takes to be approved and closure completed is another relief to most investors. The process can take less than two weeks if you end up with a professional company that knows how things work. They are, however, looking at the recovery end for themselves and want to be confident that you can fix the property defects correctly and sell as soon as possible, allowing them to get their money back. In order to assure this, liens are attached as a security measure.

Another positive note is that the longer an investor is in business and doing well the majority of the time, the less he or she will pay for a loan in the long run. Occasionally a borrower can receive 100 percent of money requested and have several projects in progress at once.

Do all the research necessary before taking on a Arizona Fix and Flip Loan—know all the disadvantages as well as the advantages. They are not the answer for everyone—if possible, borrowers need to be certain of performance as an investor is of repayment. It pays to have all the facts—take time to learn.

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.

Thursday, March 28, 2019

Colorado Hard Money Loans to the Rescue!

Investors with poor credit know that you can’t wait months or even years to repair their credit in order to make moves. Colorado Hard Money Loans allow them to quickly obtain funds.

According to credit.com, about one third of Americans have a credit score lower than 601. That can be a huge determining factor in a bank’s decision to fund a loan. It’s a fact that has to be faced along with the fact that it can take months or even a year or more to fix a credit score. While it’s absolutely a good idea to work on your credit, investors don’t have the luxury of waiting.

Purchasing real estate as an investment is a great way to make money, but when the market is hot investors need to move quickly. Places like Level 4 Funding allow those investors to get their loan funded much quicker with a Colorado Hard Money Loan, without scrutinizing the borrower’s credit.

We can also create flexible lending terms to fit the situation. We don’t have to follow guidelines that may be harmful to someone’s real estate deal.

Lightning Fast

We’ve been known to fund loans in a matter of days! Forget the waiting game. If you come to us with a well-rounded business plan to put our money to work, we’ll make your Colorado Hard Money Loan happen!

Terms to Fit Your Loan

The best part of giving out Colorado Hard Money Loans is being able to custom design the loan terms for each client. Many of our clients use our loans for fix and flip properties that they won’t own for a long period of time. That’s why we make sure to build the loan around the situation.

Is It Right for You?

Another upside to working with a Colorado Hard Money Loan is that your lender is going to give you personalized attention. We are investing in your future and want to know about your plan, your ideas, and what our money is going to fund.

You can call us today to learn more about our Colorado Hard Money Loan offerings and how we can help make your real estate investment dreams come true. We will walk you through the process and make sure you are comfortable with what we have to offer and whether our terms and financing structures will work for your project!