Beretta Only

Thursday, April 4, 2019

Qualify for Bigger Arizona Hard Money Loans by Using Your ARV

Lots of people qualify for Arizona Hard Money Loans to buy homes and make repairs, but what if we told you there's a way to qualify for more funding? You can, and it's by knowing your after repair value (ARV).

Arizona Hard Money Loans, also called asset-based loans, are loans that are secured by a property. Many lenders will only give you around 65 percent of the total value of the given asset. In other words, a property appraised at $100,000 could secure a loan of $65,000.

However, this is where things can get hairy. An appraisal works if the house is in good condition, but what if your plan is to buy the house to renovate it and resell it? You wouldn't be able to get the funding you need because the house's appraisal will show what the house is worth before the rehab.

That's where your after repair value comes in. If you can show the lender that the after repair value is much higher, you may be able to get more funding. So how do you do this?

Figuring Out Your After Repair Value

There are a few ways to zero in on a more accurate picture of your after repair value. First, gather all the relevant information — the square footage, the exterior condition and the basic specs of the house (bedrooms, bathrooms, special features). Now find 10 properties with similar features and of a similar size that sold in the last six months in the immediate area. It's important that you find matching properties that are in good condition. Doing so will allow you to show the lender what the property's potential is.

Of course, you should also use professional appraisers and have them give you an estimate for after the rehab is done on the house. Compare that estimate with your own experience in the business and bring that info to the hard money lender. Remember, you want to sell the lender on the potentiality (the future value) of the property. The more data you have to show this, the better your chances for securing more funding.

Getting a Arizona Hard Money Loan in Arizona with a Solid ARV

Once you've got your ARV — and all the convincing data to back it up — you can go to a hard money lender in Arizona to apply for a Arizona Hard Money Loan. If you're thinking about getting one and have your ducks in a row, give us a call and see how we can turn your dreams into reality.

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.

Supercharge Your Income with Rental Property Loans

Ever thought about getting a property that works for you? It might be easier than you think. How? Rental property loans in Arizona. Let's take a look at how they work.

Most people dream of having money coming in every month that doesn't require them to clock in and clock out a job they hate. Most people also think that the only way to do that is to have a ton on money in the bank to buy a rental property. If you've ever thought that way (and it's stopped you from taking action), we've got awesome news for you! Not only is it within your reach, but it's also probably easier than you think.

You might be saying you don't qualify for a bank loan so there's no way you can buy a rental property. And you'd be right. Banks have rules, regulations and guidelines for deciding to whom they loan money. If you've had a short sale or foreclosure on your record, you'll most likely be denied. If your credit score is below their mandated minimum, you're out of luck. If your bank account isn't as large as you'd like, you may get rejected.

Thankfully, the bank isn't the only place to get a rental property loan. Aspiring landlords get funding for their projects all the time from private investors. These Arizona Hard Money Loans aren't subject to the same regulations and guidelines, so lenders can decide to take a risk on whomever they want. Even if you have blemishes on your financial history and a less-than-desirable credit score, you can have a dream and a plan and get approved for funding.

How Fast Can You Get a Rental Property Loan?

Here's where Arizona Hard Money Loans really shine. With a bank loan, it might take a month or more to see your cash. Without stringent restrictions, you can get approved in a matter of days and have your money within a week or two. And, in the real estate business, being quick can sometimes give you an amazing advantage over other offers.

Where to Get a Rental Property Loan in Arizona

Now that we know that you can get approved for a loan to buy an income property, it begs the question — how do you go about getting one? Well, you're in the right place. Level 4 Funding has been doing hard money rental property loans for decades, so we have the experience to help you through the process. Contact us now to find out how we can work together.

Using Fix and Flip Loans to Make Money Flipping Houses

There are some people out there who think that you can only make money by flipping houses with bank loans. However, not only can you make money with private fix and flip loans, there are times when they actually work better than bank loans. Let's look at how.

When most people look into flipping a house, they go to the bank to get financing. They jump through the bank's many hoops, drop a bunch of their capital on fees and sometimes wait for a month or more to get financing together. Some people do it because it works for them and some do it because they think it's the only way to go about it.

Here's the good news — going through the big, inflexible financial institutions isn't the only route. Hard money fix and flip loans are a viable option, too. Here are two major reasons why:

Arizona Hard Money Loans Are Flexible

At the bank, you'll be asked to have an almost spotless financial history, a sizable amount of money in the bank and a credit score that meets their minimum. If you don't fit in their narrow box, you're out of luck. Arizona Hard Money Loans use private money and operate largely outside the "system," so while they take some of those same things into consideration, they're not bound by them. That means a hard money lender has the freedom to work with you.

Maybe your credit score isn't great or you've got some issues in your past, but you've got a vision and experience doing flips. In the hard money business, you can make your case and get the money you need to make your vision come to fruition.

Hard Money Fix and Flip Loans Are Fast

When you go through the big banks, the red tape can be debilitating. There is all manner of regulations they have to adhere to, and they have complicated underwriting processes. As a result, you might wait a week or two to hear about your approval and then another month before you see the money in your account. Not so with hard money. With very few hoops to jump through, you can get approved in a day or two and have the cash in hand within a week or two.

And we don't have to tell you how important speed is in the flipping game! If you're interested in seeing if a hard money fix and flip loan might work for you, give us a call and discuss your options today.

Wednesday, April 3, 2019

Getting a Arizona Hard Money Loan: Advice for First-Time Borrowers

If it's your first time looking into a Arizona Hard Money Loan, you might be feeling confused or nervous about the process. Don't worry, it's a lot simpler than it seems. Let's look at some things you'll need to know for your first loan.

For our purposes, let's say you're going to do a real-estate flip. So, how would you go about getting a Arizona Hard Money Loan?

When you make your initial contact, you'll want to have some key bits of information at your fingertips. You'll need to know the location of the property, have a purchase price in mind, put together a budget for the rehab and come equipped with some idea of how much the property may appreciate. And, many hard money lenders will want to know your exit strategy.

Once you've gone over this info, the lender may want to get a feel for you as the borrower, especially if you've never partnered on a project. A lender may ask if you've done fix and flips before and inquire about your financial history. Thankfully, none of these things will disqualify you — private lenders have more flexibility when it comes to loaning money.

The Next Steps After the Initial Meeting

The application process can vary significantly from lender to lender but will typically involve a loan application and showing paperwork for some of the above-mentioned factors including the purchase contract and the budget for the repairs and renovation. The underwriter will usually do an appraisal on the property and ensure that the after repair value is in the same ballpark as the borrower's estimate. In addition, they may want to check the property insurance and title history. If everything looks good, a closing will be scheduled.

At the closing, the buyer will purchase the property and sign paperwork related to the loan. Among the documents you might be asked to review, and sign include, but aren't limited to, a personal guarantee, a security agreement, a note and an investment affidavit.

The great thing about using private money for a fix-and-flip transaction? All of this process can be completed in a matter of a week or two. By comparison, a bank loan can take up to a month or two to come through.

Finding a Arizona Hard Money Loan in Arizona

For first-timers, all of this can seem daunting, but compared to big financial institutions, the process is pretty straightforward. And, any hard money lender worth his or her salt will help walk you through every step and make sure you understand what's happening. Here at Level4Funding, we have decades of experience dealing with Arizona Hard Money Loans. Give us a call today to discuss how we can work together to make your real estate dreams come true!

FIX AND FLIP LOAN WITH NO MONEY DOWN

When you ask a person interested in real estate investing why they haven’t done it yet— the most common reply is they don’t have enough money.

People see that real estate can give them a comfortable life and that there are many successful real estate agents, but so many people are held back due to money issues.

Well, myth busted! It is very possible for an investor to have multiple deals going on simultaneously and never have any of their own money in the deal. There are a multitude of lenders out there that want to lend you their money for this exact purpose, as long as they know it is a safe investment.

These lenders are called Arizona Hard Money Lenders. These lenders aren’t worried about how much money you have or your employment history. They are interested in you finding a distressed property that you are willing to rehab and sell for a profit. They receive their profit from the interest they charge.

HOW CAN I GET AN ARIZONA FIX AND FLIP LOAN WITH NO MONEY DOWN

Arizona Hard Money Lenders lend use an After Repair Value (ARV). ARV is what the house will value at following renovation. Arizona Hard Money Lenders will typically finance at least 70% ARV.

Let’s say you find a property for $50,000 purchase price. Once it’s been inspected you find out it has about $20,000 worth of repairs. You need a loan for $70,000, right? Ok, but how much will it sell for if you borrow $70,000. Once it is appraised for its’ ARV you discover you will be able to sell it for $110,000.

The hard money lender will lend you 70% of the $110,000. You will be approved for $77,000. That’s $7,000 more than you need, right? Well, maybe or maybe not. That $7,000 could go toward more materials. Or maybe you could hire a contractor to help you with the repairs. Whatever it is, take the “extra” money. More than likely you will need it. What you just received was an Arizona Fix and Flip Loan with no money down.

What if you need more money for repairs? Arizona Hard Money Lenders will finance those extra repairs, as well. These are called “draws.” A draw is money financed for a certain repair. Once the hard money lender has received the proof they deem necessary concerning the repair the borrower will receive a check.

The general public doesn’t realize that you can go into real estate investing using someone else’s money.

Fix and flips are growing as the fastest way to make a profit. Don’t miss this train. If you have considered jumping into the real estate game, this is the time to do it. Please contact us at level4funding.com. We would love help you get started

HARD MONEY LENDING ON OWNER OCCUPIED PROPERTIES

Unfortunately, due to recent consumer protection legislation, lending on Arizona owner occupied properties has becoming a frowned upon phrase in the private lending world.

However, there are ways to get an owner occupied private money loan where the borrower and lender can make a profit. Dodd-Frank is a bill—and out of this bill came how mortgages are to be handled by lenders. During time this bill was enacted the market was crazy and something needed to be done. But, many impacts of this legislation have been difficult for Arizona Hard Money Lenders and borrowers needing private money. Because of this legislation it has been a little tricky to get owner occupied loans done.

CAN ARIZONA HARD MONEY LENDERS LOAN ON OWNER OCCUPIED PROPERTIES?

Let’s start with what exactly is an owner occupied property and why is this such an obstacle? An owner occupied property is exactly what is says it is—a piece of property that the owner resides in. The government passed many consumer protection laws which were meant to protect the homeowner. That is good for the homeowner, but the result of this legislation created difficulties for lenders. No mortgage lenders are happy with this legislation.

The laws have to do with waiting periods and how the borrower must prove they can repay the loan based on their debt service ratio and so on. Arizona Hard Money Lenders are simple—they look at the property and base the loan amount on the value of the property. Easy peasy. However, all these new regulations make some Arizona Hard Money Lenders nervous. Arizona Hard Money Lenders aren’t lenders that care how much a borrower makes.

Thank goodness there is a caveat to this ordeal! There is an exception to the rule where Arizona Hard Money Lenders are still able to lend on owner occupied properties if 51% or more of the property is for business purposes. There are ways the lender and borrower can validate and prove that, as the laws require. As long as the numbers work, the loan can work. But, what does business purpose mean? It means that the money being pulled out of the property is for the use of the business. In general, if the borrower has a business and is filing business tax returns—and the borrower can prove that the money being pulled from the property is for the business, then that will be a loan considered for a business. The borrower will have to sign a business purpose affidavit. This affidavit states that this loan is for business purposes.

How does the math work on these loans? Let’s say you have a house that is worth $300,000. You want a loan for business purposes and the house is free and clear— the lender can lend 60%—you will receive a loan for $180,000 for business purposes.

Getting an owner occupied loan is trickier than in years past, but can still happen. This article was just a sneak peak into what Arizona Hard Money Lenders can do to get you an owner occupied loan. For more information, please contact us at level4funding.com.