Monday, October 30, 2023

πŸ˜€Are Home Flippers Get Burned In The Housing Market?😊

Are Home Flippers Get Burned In The Housing Market?

 
By 
M NMLS 1018071 AZMB 0923961
August 29, 2023 

After an abrupt end to the US housing boom, home flippers who were winning big just months ago are now racing to stem losses.

Since January, the doubling of mortgage rates has crushed buyer demand and depressed values in investors' most favored locations, from Phoenix and Las Vegas to Jacksonville, Florida. It's a swift turnabout for flippers such as those stuck with homes to sell and loans to pay.

Investors say, "It's a high-risk, high-reward business — and now we're facing the high risk, and I'm just praying for break even."

Flippers with loans must repay them, and rising interest rates make carrying costs even more significant. Their troubles can reverberate across the market: Just as investors bid prices higher on the way up, they can accelerate the move downward.

For most fix and flippers, the focus will be on selling, and the faster, the better. A small number will keep buying even though finding truly undervalued homes is near impossible and a guessing game of how far the market will drop.

Home-flipping activity reached a record at the start of the year, making up one in 10 transactions, surpassing the levels in the last bubble, according to Attom, an Irvine, California-based data provider, which tracked sales of properties that previously sold within the last 12 months. While the share remains elevated, it fell to 8.2% in the second quarter of 2023.

Conditions have deteriorated more since then, with mortgage rates near the highest level in 20 years. Demand has cooled particularly fast in Sun Belt markets such as Phoenix, Jacksonville, and Atlanta, pandemic boom areas where affordability has been strained. Fix and Flippers made up about 14% of transactions in those regions in the second quarter, but those shares sank in July and August, according to more recent monthly data provided by Attom.

Phoenix property investors have had to slash prices after the slowdown caught investors. A lot of investors are getting hammered.

Losses will grow, but even thin margins are a big problem when you're a full-time flipper.

We have hard-money loans with 10% to 14% interest rates. It's a constant dance — do I wait it out, or does the price drop? Both cost money.

For the most part, investors are paying back their loans, said Matt Prosory RI/Broker at Level 4 Funding, a hard-money lender in Phoenix, Colorado, and Texas. The default rate was 1.25%, which has climbed to 2.5% in the past two months. But it remains below pre-pandemic norms.

Matt said fix and flippers with nicely renovated turn-key properties will stand out in this market. But it will be painful for those who overpaid, counting on rapid appreciation to make them money, he said.

"Lots of them, in hindsight, were making bad buys. Anybody fix and flipping right now must look closely at the property pricing: Price it to sell. Today is not the time to get greedy.

 

Phoenix flippers are trying to put things in perspective. Flippers have purchased much more over the last two years than they will likely lose. Fix and Flippers are giving back the money they made.

I ask my flippers if flipping is dead or at least dying. Here in the Phoenix, Arizona, metro area, I have watched the margin on deals become slimmer and slimmer. During the past few years, television shows and seminars have flooded the flipping market with people who believe flipping homes is an easy way to riches. Trustee auction prices are near MLS prices (retail), and I cannot believe what people are paying.

I recommend that flippers take an extended vacation and return later to see how the market is going.

 

Matt Prosory RI/MLO/Broker

NCO Enterprises LLC
Dba Setabay Private Hard Money
26731 N 90th Drive
Peoria AZ 85383
Telephone: 623-582-4444
NMLS 2062278 NMLS 1118493


Equal Housing Opportunity. This is not a Good Faith Estimate nor a Guarantee to lend and should not be considered as such. Costs, rates, estimates, and terms can only be determined after completing an application. Actual payments will vary based on your situation and current rates. APR for loans ranges from 7.99 - 29.5% and is based on Credit Score, Down Payment, LTV, and Income. Mortgage rates could change daily. For more accurate and personalized results, please call 623 582 4444 to talk to a licensed mortgage expert. Terms and conditions of all loan programs are subject to change without notice. NCO Enterprises LLC Dba Setabay Private Hard Money 26731 N 90th Drive Peoria AZ 85383 Telephone: 623-582-4444 NMLS 2062278 NMLS 1118493 This email is for the exclusive use of the intended recipients and may contain privileged and confidential information. If you are not an intended recipient, please notify the sender, delete the email from your computer, and do not copy or disclose it to anyone else. Your receipt of this message is not intended to waive any applicable privilege. Neither this email nor any attachments establish a client relationship, constitute an electronic signature, or provide consent to contract electronically unless expressed by Matt Prosory RI/CEO, in this email or an attachment. To the extent this message includes any tax or legal advice. This message is not intended or written by the sender to be used, and cannot be used, for legal or tax purposes or advice. This email is an advertisement.

 

 







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Level 4 Funding LLC · 26601 N 19th Ave Suite 112 · Phoenix, AZ 85027 · USA

Monday, October 23, 2023

πŸ˜€Are You Considered Using A Hard Money Lender?😊

Are You Considered Using A Hard Money Lender?

 
By 
M NMLS 1018071 AZMB 0923961
August 29, 2023 
 

One of the most common hurdles for new investors is finding money to fund their deals. While this can be a struggle, finding the capital you seek is more accessible than ever. Between lines of credit, private lenders, retirement funds, credit cards, and traditional bank loans, numerous options are available to those who know where to look. The key is to find a funding source that works for you. Often, that source will be a hard money lender. The hard money lender in Phoenix has gotten a bad rap over the years but has proven a reliable way to fund deals. If you don't have a hard money lender in Arizona outlet or have yet to use one, now may be the time to find as much information on them as possible.

hard money lender is an individual or group who lends money on their terms. They put stock in the property and the actual financials of the borrower more than anything else. With traditional lender financing, if your credit score falls below a certain threshold, you may have trouble getting approved regardless of other factors. However, Phoenix hard money lenders have their own set of criteria. For this flexibility, there are more fees and higher interest rates. Some investors will balk at those opting for lower rates that banks offer. This can work on specific properties and deals, but you need to act quickly on those that are time-sensitive, and that's precisely what hard money allows you to do. Here are just a few of the benefits of using a hard money lender:

  1. Speed: In today's real estate landscape, how quickly you can close is often more important than the amount you offer. Too many lenders have been burned in the past waiting for deals to close that never do. Even if they do close, the average length of a financed transaction approaches 45 days. Most sellers would instead take a slight discount, assuming they can close in a week rather than risk closing in 45 days. This speed allows you to make offers with five or seven-day closings. On borderline deals, you can bet that your offer will be the one that is accepted.
  2. Volume: Instead of waiting 45 days to start working on the property, you can reduce the time to just a few weeks. Shaving a few weeks off every rehab project, you start allows you to close more deals over a year. Adding just one or two deals to your portfolio will increase your bottom line exponentially. Often, you may be able to close two or three times the volume you closed the previous year. When the number of deals you complete starts to creep upward, so will the number of contacts you make. The people you meet are just as important as the deals themselves, if not more so. Remember, real estate is a people business. The more deals you do, the more contacts you can make. In turn, those contacts may even lead to more deals.
  3. Quality: Having capital to close is only part of the benefits that coincide with Arizona hard money. With hard money in your corner, you could do whatever needs to be done for the property. Instead of cutting corners to save money, you can do the work you know needs to be done. This will help you maximize your bottom line and improve your reputation in the industry. Realtors and fellow investors who see your finished products may want to work with you. Quality will also help get your property sold to end buyers much faster. Instead of hoping that an offer comes in, you will have your choice of deals.
  4. More significant Projects: Increased capital allows you to build up to more significant projects slowly. Instead of looking solely at single-family properties, you can start to look at multifamily and commercial deals. Furthermore, closing more deals will increase your capital and give you a larger share of bigger deals. There is nothing wrong with sticking to condos and single-family properties, but having hard money behind you allows you to explore other options that come your way.

Aligning yourself with a hard money lender doesn't mean you have to use them on every deal. A property you want to buy and hold may be better served with a long-term interest rate of around four percent. However, most rehab projects need the efficiency that hard money brings. The goal should be to save some capital from every deal until you have enough saved to fund them yourself. Until you reach that point, you may have to make a little less per deal to increase your bottom line.

The biggest knocks on hard money are the high fees and points. These accrue from the time of settlement until you can sell the property. In some cases, it can span several months. However, it is a small price to pay for what you get. The annual interest over just a few months is a relatively minor factor compared to all the other expenses you incur. Additionally, you only pay these on deals you close. If you can't close, you can't earn; hard money helps you close more deals. It is not for everyone in every deal, but it should be a part of your financing options.

 

Matt Prosory RI/MLO/BrokerNCO Enterprises LLC
Dba Setabay Private Hard Money
26731 N 90th Drive
Peoria AZ 85383
Telephone: 623-582-4444
NMLS 2062278 NMLS 1118493


Equal Housing Opportunity. This is not a Good Faith Estimate nor a Guarantee to lend and should not be considered as such. Costs, rates, estimates, and terms can only be determined after completing an application. Actual payments will vary based on your situation and current rates. APR for loans ranges from 7.99 - 29.5% and is based on Credit Score, Down Payment, LTV, and Income. Mortgage rates could change daily. For more accurate and personalized results, please call 623 582 4444 to talk to a licensed mortgage expert. Terms and conditions of all loan programs are subject to change without notice. NCO Enterprises LLC Dba Setabay Private Hard Money 26731 N 90th Drive Peoria AZ 85383 Telephone: 623-582-4444 NMLS 2062278 NMLS 1118493 This email is for the exclusive use of the intended recipients and may contain privileged and confidential information. If you are not an intended recipient, please notify the sender, delete the email from your computer, and do not copy or disclose it to anyone else. Your receipt of this message is not intended to waive any applicable privilege. Neither this email nor any attachments establish a client relationship, constitute an electronic signature, or provide consent to contract electronically unless expressed by Matt Prosory RI/CEO, in this email or an attachment. To the extent this message includes any tax or legal advice. This message is not intended or written by the sender to be used, and cannot be used, for legal or tax purposes or advice. This email is an advertisement.

 

 







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Level 4 Funding LLC · 26601 N 19th Ave Suite 112 · Phoenix, AZ 85027 · USA

Wednesday, October 18, 2023

Hard Money Loans for Owner Occupied Borrowers

Owner-occupied hard money loans are considered principal residence Loans, alternative financing, and private money loans. 

Reasons Why Borrowers Use Owner-Occupied Hard Money Loans 

  • Bad Credit 
  • Hard to prove income 
  • Self Employed 
  • or dealing with a problem property  

    Typical borrowers refinance this loan after qualifying for a conventional or FHA loan. 

    Common Uses of Occupied Loans 
  • Buying a first or second home. 
  • Refinance an existing loan. 
  • Cash out for repairs or remodeling. 
  • Cash out for debt consolidation.  

Owner Occupied Hard Money Loan Program Options  

100% financing is available if the borrower has another free and clear property, or has a small mortgage with value (substantial equity) to pledge as additional collateral ( aka Cross Collateralized Loan).  

Arizona Hard Money Lender is making real estate loans to both Investors and owner-occupants in Arizona. 

Typical Arizona private hard money programs for owner-occupants are below. 

NO PRE-PAYMENT PENALTY 

Typically, there are no pre-payment penalties on our loans. 

  

PURCHASE 

Down payment: 30% - 40%. 

Up to 60% or 70% of the appraised value 

Up to 100% financing with a 2nd free and clear property as additional collateral. 

  

REFINANCE 

Up to 65% of the appraised value 

Up to 100% financing with a 2nd free and clear property as additional collateral  

ORIGINATION FEE 

            A loan Origination fee of 2 to 6 points (2 to 6% of the Loan Amount).  

Requirements For Owner-Occupied Hard Money Loans 

Income must be able to be verified by a 3rd party source. 

If the owner-occupied loan is considered a "high-cost loan," hazard insurance and property taxes must be impounded for the 1st year of the loan. This is the borrower's responsibility. 

Disclosure laws require us to inform you of the loan terms before signing any loan documents. These are the exact requirements of a traditional bank loan. 

Apply for an Owner Occupied Hard Money Loan 

If you want to see if you qualify for an owner-occupied hard money loan in Arizona, call us today at 602-497-4444 or fill out our loan application to get started. Getting your owner-occupied hard money loan is simple and fast; we do the funding!  So, if we say you're approved, you'd better start packing to move into your new home! 

The owner-occupied Arizona hard money loans program makes it easy for you to get the new home you need despite not having credit, having bad credit, or even if you're not from the United States.   

Owner-occupied home loans using private hard money have easier requirements than investor loans and can benefit from our cross-collateral 100% LTV loan option. 


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

Monday, October 16, 2023

How to Invest in Real Estate Investing with No Money Down😊

How to Invest in Real Estate Investing
With No Money Down

 

Learn what it takes to be a flipper and
make a lot of moola.

The idea of real estate investing with no money out of your pocket is enough to pique anyone's interest. .......


Keep Reading

Matt Prosory RI/MLO/Broker
NCO Enterprises LLC
Dba Setabay Private Hard Money Lender
26731 N 90th Drive
Peoria AZ 85383
Telephone: 623-582-4444
NMLS 2062278 NMLS 1118493

Equal Housing Opportunity. This is not a Good Faith Estimate and this is not a Guarantee to lend and should not be considered as such. Costs, rates, estimates, and terms can only be determined after the completion of a full application. This is an advertisement..

 

Copyright © 2023 Setabay Private Hard Money, All rights reserved. 9
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Monday, October 9, 2023

Are you going crazy looking for a home loan?😁

Don't Go Crazy Looking For Money
Are you having trouble getting a loan?
  • Purchase & Refinance
  • No FICO Considerations
  • Cash Out Refi's - Debt / Home Improvements
  • Self-Employed Borrowers 
  • Bank Statement Loan
  • Owner-Occupied and Investor Loan
  • Long Terms UP to 30 Years Full Amortized
  • Loans from $10,000 to $1,000,000+
  • No Prepayments Penalties
Matt Prosory RI/MLO/Broker
NCO Enterprises LLC
Dba Setabay Private Hard Money
26731 N 90th Drive
Peoria AZ 85383
Telephone: 623-582-4444
NMLS 2062278 NMLS 1118493

Equal Housing Opportunity. This is not a Good Faith Estimate nor a Guarantee to lend and should not be considered as such. Costs, rates, estimates, and terms can only be determined after completing an application.


 

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