Beretta Only

Friday, January 25, 2019

3 Options for Getting a Loan to Flip Houses in Arizona

House flipping is as hot as ever and, for the right kind of person, it can be quite lucrative, too. Unless you're already loaded, you're going to need to find a loan to do it, so here are some tips for doing just that.

According to the research firm Attom Data, over 200,000 homes were flipped in the year 2017. The average profit on each flip? A whopping $68,143! That's a pretty good take for a three, six or even 12-month project. Of course, to get there, you need to find a great fixable property and secure financing. There are a number of ways to get loans to flip houses in Arizona, and here are three of the most popular.

Go to a friend or family member. It could be a cousin, an uncle, a parent, or a brother, but if a family member has the cash on hand, they may be interested in investing in your fix and flip property. They may charge you lower interest rates because of your personal connection, or they may want to arrange of cut of the final profits. However, you choose to proceed, make sure you get everything in writing. There's no faster way to lose a friend or family member than getting involved with a loan.
Go for a home equity line of credit (HELOC). Many banks will let you borrow against the equity of your current home. By equity, we mean the difference between your home's market value and the remaining mortgage balance. The nice thing about a HELOC is that you have a pool of funds from which to draw, and you'll only pay interest on the amount you use. The downside to a HELOC is that you must already own a home with significant equity.
Go for a Hard Money Loan in Arizona. Hard money loans use funds from private individuals and investors. The requirements for qualification are less than a bank loan because the loan is secured by collateral. Hard Money Loans in Arizona to flip houses also come through much faster (in as little as 2 weeks).

Going the Hard Money Route

Hard Money Loans in Arizona are a great option if you've been turned down by the banks or you don't have relatives who are willing to invest. Keep in mind that the terms of a Hard Money Loan in Arizona will be shorter, and the interest rates will usually be higher. That's what makes them perfect for flipping — the idea is you get your property, fix it up, and then sell it for a profit before the terms are up.

Finding a Hard Money Loan in Arizona for a Fix and Flip

Thinking about going with a Hard Money Loan in Arizona to flip houses? If you have questions about whether to qualify and how the process works, we're here to answer them. Give us a call or chat with us today to see how we can help.

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.

Thursday, January 24, 2019

4 Burning Questions About Commercial Hard Money Loan in Arizonas

If you've got a commercial real estate investment on your radar and the banks have turned you down, you've probably thought about a Hard Money Loan in Arizona. You're probably full of questions about this type of financing. Luckily, we're full of answers.

Thinking about going the hard money route to finance a commercial real estate project? If so, don't worry — you're not alone. Plenty of people have started where you are and they've been incredibly successful. But it starts with the basics, so let's go over some of the most common questions we get from prospective borrowers.

How fast is the process? It's really fast, especially when compared to a bank loan. Approval can happen in a matter of days and funding can come through within 72 hours of getting the green light from the title company.
What about the interest rates? Interest rates for commercial Hard Money Loan in Arizona are higher than through the bank. How much higher? That depends on the lender you choose. Most often, the rates will vary from 10 percent to 18 percent.
How long are the terms of the loan? Since they're typically used as a bridge until you get long-term financing, most Hard Money Loan in Arizona s fall in the 3-month to 12-month range, although there are some that can be as long as 3 years. Generally, the longer the terms, the higher the rates and costs.
Does my credit make a difference? Perhaps. Most Hard Money Lenders in Arizona will do a credit check, but it won't weigh as heavily as it does in a bank loan. The lender will spend more time examining the property that's being used as collateral.

How Hard is it to Qualify for a Hard Money Loan in Arizona?

It's a question we get all the time — how hard is it to get approved for a Hard Money Loan in Arizona? Let's answer that right here and right now.

There's a lot of mystery surrounding Hard Money Loans in Arizona, and for good reason — they admittedly have a spotty history after some unscrupulous lenders took advantage of borrowers in the past. Add to that the housing loan debacle and the passing of the Dodd-Frank Act, and you've got a lending industry that's harder to figure out than ever before.

Before we delve into getting approved for a Hard Money Loan in Arizona, let's look at the approval process for a typical bank loan.

● Banks will dive deep into your financial history. Any issues — like a foreclosure, short sale, or bankruptcy — will most likely be a deal breaker.

● Banks require a good credit score. Most big banks want you to have a credit score of 740 and some will go down to 700, but the interest rate will increase the closer you get to that minimum number.

● Banks want a sizeable down payment. If you want to get approved for a bank loan, you'll be asked to have at least 20% of the value of the property on hand to use as a down payment.

Getting Approved for a Hard Money Loan in Arizona

The application and approval process for a Hard Money Loan in Arizona is completely different. First of all, there's no complicated underwriting process. This means the entire thing can be completed in as little as a week or two. Secondly, and most importantly, this type of loan is secured by collateral. So, instead of condemning you for blemishes in your past or looking at arbitrary numbers, a Hard Money Lender will listen to your plans and check out the collateral you have. Finally, lenders in this field get money from private sources, so it makes it a quite simple equation — if your investment is sound and your collateral works, you can get approved.

Find a Reliable Hard Money Lender in Arizona

If your real estate investment is in Arizona and you don't qualify for a bank loan, here's the good news: you're already in the right place. Level4Funding offers hard money to real estate investors, and we've been doing it successfully for decades. Give us a call today to see how we can help get you financing.

How to Find a Reputable Hard Money Lender

Considering using hard money to finance your real estate investment? The process is much different than going through the bank, so we're here to help you get approved for one.

Hard Money Loans in Arizona are loans that are backed by collateral. That is, they aren't based primarily on credit scores and down payments like a traditional bank or credit union loan. Often, they're used as a bridge between a construction loan and long-term financing, or as a way to finish a fix and flip to turn a profit quickly. Hard Money Lenders in Arizona aren't regulated by the Office of Thrift Supervision or the Federal Reserve, so finding a reputable one can be a challenge.

Here are some questions to ask yourself when looking for a trustworthy lender:

What projects has the lender financed previously? If you're looking for a Hard Money Loan in Arizona for a fix and flip, look for a lender who has completed financing for fix and flip properties. If it's for spec construction, do your research and find one who has experience in that niche field.
How does the website look? Some lenders are fly-by-night; others just collect your information and pass it on to third parties. A legitimate Hard Money Lender in Arizona will have a professional website with a wealth of relevant information about what they do.
Are they easy to get ahold of? Their website should have a phone number, an email address, or a live chat where you can speak with a contact one-on-one. A reputable lender will want to talk with a potential borrower to hear about their project personally.

Make Sure to Do Your Research

Unfortunately, it's true — some lenders in the hard money game are essentially loan sharks looking to take advantage of people who've been turned down by the banks. Thankfully, there are many lenders out there who are genuinely interested in your real estate dreams and want to help them come true. By using our questions above and speaking with a lender, you'll typically be able to weed out the fakes from the real deals.

Hard Money Lenders in Arizona

Finding a reputable Hard Money Lender in Arizona is actually quite easy. Level4Funding has decades of experience with fix and flip, rentals, buy holds, and real estate sales in Arizona. We're a phone call, email, or live chat away — if you've been told "no" by the banks and credit unions, contact us to see how we can help fund your real estate goals today!

Arizona fix and flip loans offer a short-term vehicle for real estate investors to purchase properties, renovate, and sell the house for a profit, otherwise known as the fix and flip model. Arizona Hard Money Loans offer financing for investors to purchase houses and quick closing on properties in any condition.

Hard money Arizona fix and flip loans are for experienced flippers as well as novices. This loan can be closed in as little as 15 days and is perfect for experienced flippers that have at least three rehabs completed. Inexperienced investors can use a licensed contractor to help them through their first fix and flip model. It’s important to remember that this type of loan allows investors to compete with cash buyers. Terms for hard money Arizona fix and flip loans range from 1 to 3 years with funding is as little at 7 days. Rates range from 7% to 12%, lending fees 1.5% to 12%, and closing costs are 2% to 5%.

Fix and flip cash out refinancing is another option. If you have an existing property, you can refinance to purchase a new investment property by getting the equity out of your existing investment property. This type of financing is best for the following investor: rehabbers with existing owner-occupied primary residence, rehabber with non-owner-occupied investment property, and rehabbers with 30% to 40% equity in an existing property. Cash out qualifications are: 640+ credit score, debt to income 45% or less, cash reserve 0-6 months, debt service 1.25, and personal tax return 2 years.

Home equity line of credit for rehabbers works more like a credit card than a conventional loan. You draw on this line as you need it and is paid back on a monthly basis. This is best for rehabbers with owner-occupied primary residence, rehabbers with more than 15 percent home equity, and rehabbers with a targeted project in mind. Rates and terms of home equity line: term is 20 to 30 years, approval time is 45 days, rates 4% to 5.5%, loan origination fee 2% with interest only payments for 5 to 10 years and principle 15 to 20 years.

Investment Property Line of Credit

This is a line of credit (LOC) on investment properties. It works like a credit card, you make withdrawals as you need them. Investment line of credit is right for: 30% to 40% equity on non-owner-occupied existing property, and a rehabber who has a portfolio of investment properties who wants to purchase a new property. The terms of the investment property Arizona fix and flip loan: 18 -24 months, approval up to 30 days, rates 5.2% - 8%, Fees 1% - 2%, and closing costs 1% - 5%.

Bridge loans for rehabbers are short term loans that provide funds for the gap between real estate projects. Loan qualifications include proving the ability to pay two mortgages, 20% equity in existing property, and an exit strategy.

Online mortgage & permanent bank loans offer the following rates and terms: term 15 - 30 years, funding 30 - 45 days, rates 4.5% - 6.6%, fees 0% - 1%, closing costs 2% - 5% and a monthly repayment schedule. These are used by owner-occupied and non-owner-occupied primary residences and investment properties. Qualifications include a credit score of 640+ and debt to income at 45% or less. At Level 4 Funding, we have provided hundreds of fix and flip investors the capital they need at the best rates possible. Call us for a no-obligation quote.

Wednesday, January 23, 2019

What you Need to Know About Arizona Airbnb Loans

Airbnb has become very popular for both travelers and Airbnb hosts. Find out how to obtain your first Arizona Airbnb Loan so that you can get into this growing segment of real estate investing.

Airbnb has become very popular. Since 2017, all leisure travelers have booked 25% of their stays at an Airbnb rental property. There are over 4 million listings in more than 191 countries. These numerous travelers who are eager to stay at an Airbnb represent a good opportunity for people to generate extra income by renting out a house, condo or other space. On average, hosts make $924 a month. Some hosts have made enough to even quit their jobs. You need to remember that there are costs associated with Airbnb such as increased insurance, paying commission to Airbnb, cleaning costs and restocking costs associated to get the property ready for the next guest.

If you desire to become an Airbnb host, you will need an Arizona Airbnb Loan. One of the obvious costs required when becoming an Airbnb host is the property itself. A decision you will have to make is whether you will buy or rent a property to list on Airbnb. You will need to talk with your CPA to review your tax situation. If you are renting out your personal home, after 14 days you will need to report this income. If the property is not your primary residence, then you will need to report this as rental income.

Commission charged by Airbnb to process payments is an additional cost. This reduces your profit margin. Lastly the supplies, cleaning, and insurance of the rental property before the next guests arrive are additional costs that will lower your profit margin.

Financing Challenges for Airbnb

All these costs add up quickly and will require that you shell out thousands of dollars before the first guest is booked. Financing for people operating an Airbnb is difficult. One reason is that banks are reviewing the financing of Airbnb properties and not sure how to classify them if they are to be used as a rental property. Mortgages for rental properties have been viewed by banks as a highly risky loan. As far as a home equity line of credit, banks will not lend on a property that is used for Airbnb.

Local laws and ordinances also can be challenging. Some cities outlaw the use of homes as an Airbnb rental, so banks will not lend on them.

While Arizona Airbnb Loans through conventional lenders may be difficult, there still are possible financing options. In recent years, companies offering small business loans have popped up. An example of one is Payfully. While they do not finance property purchases, they do purchase Airbnb reservation receivables. Payfully will deduct a fee for this service and this will need to be calculated in you forecasted profit. This is an expensive additional expense. Airbnb also offers an early payout with a one percent fee. There are also companies that will advance on credit card payments which is, again, a very expensive option. If you are seeking to get your foot in the door as an Airbnb host, obtaining an Airbnb loan may be challenging, but there are options to assist you. At Level 4 Funding, we have provided capital to an extensive list of Airbnb hosts. Call us for a no-obligation quote.