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Tuesday, April 16, 2019

Top 3 Ways to Boost Your Eligibility for Arizona Spec Home Financing

Arizona Spec Home Financing is back in a big way, but not everyone who applies for a loan will qualify. Make your application stand out from the pack by addressing a few often-overlooked issues.

1. Have a builder with experience and a good reputation on your team. People move into spec homes from all walks of life. Some are coming from the fix-and-flip biz while others are relying on their natural skill or come from some kind of construction or repair-related background. This kind of experience does matter and will help you have a more successful outcome, but it’s not enough to get a loan. If you, personally, do not hold a contractor’s license and do not have previous projects which demonstrate your success, you aren’t going to get Arizona Spec Home Financing. Find someone to partner with on your first few projects who already has a good reputation in the industry and you’ll get more approvals.

2. Bring an appraiser on board early. It may sound strange to have a house that hasn’t even been built yet appraised, but you can get an estimated value based on your plans and similar homes in the area. An awesome appraiser can also give you tips and ideas before you build, so that you can pivot your plans to collect more cash if anything has been overlooked. Most lenders will want to see the appraisal too.

3. Be prepared to put some skin in the game. The amount of your down payment will vary based upon the lender, but most builders have to put 20-25% down.

Show Lenders You’re the Real Deal with a Detailed Plan

You’ll need to be well beyond the idea stage when you approach lenders for Arizona Spec Home Financing. It may sound like you’re putting the cart before the horse—how can you plan if you don’t know how much you can get? That’s not true when it comes to applying for loans. Your investors will want to know how you plan to spend the money, what your timeline is, and what will be going into the finished project. Be prepared with floorplans, a full materials list, and other items which showcase your budget and the scope of your plans.

If you can plan it, you can successfully fund it.

There are many forms of Arizona Spec Home Financing, though chances are you’ll be looking for Arizona Hard Money Loans for this. In these cases, you’ll need to purchase the land to build on and can then use that as your collateral for the building portion. Lenders may also allow you to use other assets as collateral. For example, if you’ve got investment properties already, you may be able to use one or more of them. Knowing which asset you’ll be leveraging can also help you identify how much money you’ll have to spend before planning. Try to keep your costs to no more than 70% of the asset you’re leveraging. Yes, you may be able to get as much as 85%, but not all lenders will go this high, so it’s important to start off with conservative estimates and go from there. The same mentality will help you immensely throughout the whole approval 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.

Top 10 Cities to Invest in Real Estate with Colorado Hard Money Loans

Ever wonder where the best places to flip or hold with Colorado Hard Money Loans are? According to a new report, more people rent one-way moving vans to the Sun Belt states than anywhere else.

Penske truck rental service recently published some insider insights regarding where people throughout the United States are moving to and they have some major commonalities. All but two in the top ten are considered Sun Belt states. Technically speaking, the Sun Belt encompasses all regions south of the 36^th parallel. More concisely, it’s the states which run across the southernmost border of the United States from California through the southernmost tip of North Carolina.

This development isn’t particularly surprising because populations in the Sun Belt have been booming since the 1960s, and air conditioning is likely to thank for it. Since then, cities have built up dramatically and offer all sorts of recreational activities year-round. Although often sought out by retirees who have grown tired of snowy regions, the diverse activities and cultural hubs have made the Sun Belt states destinations for all. In short, all this means that if you apply your Colorado Hard Money Loans to homes in the Sun Belt states, you’ll have more command over the sale.

If You Can Work in One of These Ten Cities, You May Have More Successful Sales

When working with Colorado Hard Money Loans, you’ll always want to have a solid exit plan before jumping in. Knowing the cities people move to most can serve as a good starting point for research. They include:

· Atlanta, Georgia; median home value of $255,100

· Phoenix, Arizona; median home value of $239,000

· Tampa, Florida; median home value of $219,500

· Orlando, Florida; median home value of $235,300

· Denver, Colorado; median home value of $424,200

· Houston, Texas; median home value of $183,000

· Las Vegas, Nevada; median home value of $273,000

· Charlotte, North Carolina; median home value of $220,700

· Austin, Texas; median home value of $73,800

· Portland; median home value of $423,200

Beware: move-ins only account for part of the picture.

It’s important to note that the number of people moving to a region only account for a portion of the picture. Yes, populations are growing in the Sun Belt, especially in and around the cities mentioned. However, the Penske report doesn’t actually cover the housing market. There’s no research indicating how many homes are on the market nor how long houses stay listed. In some cases, your own research could turn up that an area has a surplus of homes, in which case, it may not be the best place to flip unless you’re able to bring something to the table that other sellers can’t. Furthermore, regulations will vary from city to city, meaning some may have regulations which make it harder to buy, fix, or sell. Lastly, the availability of Colorado Hard Money Loans will vary based upon a number of factors. Most lenders prefer to work a specific geographic area because they know it well, are familiar with the laws, and have seen successful investments in the area. So, at the end of the day, you’ll need to do your homework. This list may be a good starting off point if you’re not sure which region to do your flips or holds in, but you need to evaluate each region and each opportunity on its own merit.

Monday, April 15, 2019

Experts Say Market is Stable: Invest with Arizona Hard Money Loans

Changes in the housing market this year have made some wary of an impending crash, but experts say the data concludes it’s stable. You can still use Arizona Hard Money Loans to invest in properties and earn some serious cash.

Some worries about the housing market have arisen because 2018 was filled with skyrocketing values and a housing shortage, but the numbers shifted at the end of the year a bit. However, experts say this is not a cause for concern—the market is stable and expected to continue to remain strong. According to a recent AZ Central news report, “96 out of 100 top national economists don't expect a housing crash this year.” This is based on data pulled which does show changes in the market but indicates ongoing stability for the foreseeable future.

“The supply of homes for sale increased, and sales slowed during the last three months of 2018,” explained senior housing analyst Tina Tamboer in a meeting of more than 100 real estate agents just a few weeks ago. “But, nothing in the current data shows a market crash coming for Phoenix,” she said.

Her findings concur with what many already know: it’s a seller’s market. Prices aren’t necessarily climbing at the rates they were, but that’s actually a positive thing because the market can’t sustain continuous rapid climbs at that rate. The good news is, you can make money with Arizona Hard Money Loans regardless of whether it’s a buyer’s market or a seller’s market. If you haven’t worked in a seller’s market before, however, you’ll need to adapt your strategy to suit.

Learn How to Make Money with Flips in a “Seller’s Market”

People flocked to fix-and-flips when it was a buyer’s market; when homes could be picked up at a fraction of their value. This doesn’t happen quite as much in a seller’s market, so you have to be mindful how you apply your Arizona Hard Money Loans, simply because you can’t rely on value increases to line your pockets. You must find a good deal to start with and put in some sweat equity or choose the right repairs and upgrades to increase value. In addition to this, it may be beneficial to apply a unique strategy, such as working on multi-family dwellings or subdividing land in popular areas.

Be more successful with the right plan and funding.

Once you understand how the market shift changes how money is made, the next step is to identify the right source of financing for your project. Arizona Hard Money Loans work well in this climate because the initial sellers of the home likely have options. Having cash in hand works wonders to sway someone who’s eager to move or simply wants to be assured the sale won’t fall through because the buyer couldn’t get financing. It also lets the flipper move fast when a home is priced under value, so it can be grabbed before other flippers get to it.

Why Do Texas Hard Money Lenders Care if I Run an LLC?

You may have trouble finding Texas Hard Money Lenders to work with if you aren’t established as an LLC. In short, this is due to governmental red tape, but you do have options if it’s a sticking point in your approval process.

Whether you label yourself as an investor, entrepreneur, house flipper, or businessman, the reality is that most people just getting into investment opportunities or making money through real estate are getting into it alone. As such, it probably doesn’t matter to you, personally, what happened with the consumer market years ago, so long as you can make a profit on real estate today. However, it does impact how Texas Hard Money Lenders and other financial institutions behave now, and that means it impacts you when you apply for a loan.

It would be challenging to find someone who wasn’t impacted by the recession or at least didn’t know someone who was. The reasons for this are well cited, with all sources pointing to changes in the housing market in 2007. Prior to this, houses were selling like hotcakes and anyone could get approved. Sub-prime mortgages reigned. That is, until they didn’t. Ultimately, banks fell apart and the job market tanked. Everyday people lost their homes and more. It took years to recover and it’s certainly nothing the world wants to see again.

The government stepped in with a slew of new regulations to prevent recurrence. For the most part, these changes impact the consumer market, not commercial loans. Therein lies the issue. How do you prove that you’re borrowing for business purposes unless you’re registered as a business?

Avoiding the Pitfalls of Government Regulations is Key in Real Estate Investing

Obviously, you, as a business, probably can’t afford to jump through government hoops or slow funding. You know what you’re getting into and have a business plan for your real estate investment, which means it’s important to ensure you’re not subject to the general consumer guidelines. When it comes to the Truth in Lending Act (TILA), for example, your loan is exempt from the extra red tape if the funds are being used for business or commercial purposes. That should be a win by itself, but there are harsh penalties for Texas Hard Money Lenders and other entities that may unintentionally breach protocol. Ergo, many go by the second method to exempt loans; extending them only to “non-natural persons,” which is legalese for “businesses.” Ergo, you may not qualify unless you’re established as an LLC, partnership, or corporation.

If you can fill out basic paperwork, you can establish an LLC.

Again, not all Texas Hard Money Lenders require you to have an LLC. Some are simply satisfied knowing you’re using the funds for business. However, having an LLC has its perks—namely limiting your personal liability in the event something goes wrong. Maybe someone slips on your sidewalk or something similar occurs and you wind up in court. The LLC protects you—the person—from business-related damages. The amount to file varies by state and it can be anywhere from $50-500, but it’s little more than $100 on average. In other words, filing is cheap, and there are many benefits to it.

How to Rig Your Credit & Why Arizona Hard Money Lenders Don’t Care

Experian is rolling out a new program that could let you rig your way to a better credit score. It won’t likely impact your ability to work with Arizona hard money lenders, but there’s some chance it could actually harm your ability to get a loan with good terms with other lenders.

If you haven’t delved deeply into credit scores before, you may be surprised to learn that you don’t have a single score. You have several. There are three big credit bureaus (FICO, Experian and Equifax) which gather data related to you and financial habits, then provide some type of score to help financing companies determine whether you’re a safe borrower or not.

Each assigns you a numerical credit score using an algorithm. Most credit reporting models are based upon FICO’s model, so your credit scores will likely be similar across all three. However, each is unique and sometimes one receives different information than the others, which naturally makes the outcome different too.

When you apply for a loan, the financing company may pull a report from any of them or all three. However, with FICO, decisions are purely based upon the credit score. If a company says you need to have a 700 to qualify and you have a 699, you’ll be denied no matter the reason. With the other two, a full report containing things like open accounts and late payments is provided, so financing companies can take circumstances into account if they so choose.

Historically, there’s been nothing a person could do if he or she had rotten credit—at least not quickly. If your past was problematic or you hadn’t established credit, those were indicators you might not be a safe bet. That makes sense. You’d have to spend years building or rebuilding to get credit from a traditional finance company. Arizona hard money lenders have always been a bit different in this respect, simply because your credit score is not a major factor in the decision to lend.

If You Can Pay at Least Some of Your Bills on Time, You Can Game the System

Experian is now going to let you cherry-pick some of what appears on your report. Under the new program, Experian Boost, you’ll be able to link Experian to your bank account and it will pull data on things like phone and utility bills. Then, it will show you each bill it can count, let you know how it will impact your score, and allow you to pick which ones to include in your score. If you decide you don’t like it, you can shut it off. While this won’t undo a bad credit history, including bills you’re a good payer on can demonstrate creditworthiness and show you’ve had credit for a longer period of time, thus potentially increasing your Experian score and getting you approval with companies which prioritize Experian. Again, Arizona Hard Money Lenders won’t necessarily care about this. The majority use a FICO score and, even then, it’s the value of the asset you’re borrowing against that matters most.

Experian’s shift could spell danger for the future of lending.

As a consumer, you’re probably excited about this change because it could be an easy way to instantly improve your credit score. Therein lies the problem for financing companies and perhaps a few Arizona Hard Money Lenders who break from the norm. While Experian says this does not change its predictive abilities, there’s some chance financing companies may stop trusting Experian or require higher scores if time proves otherwise.

Sunday, April 14, 2019

Benefits of Hard Money Rental Property Loans

Forget conventional lenders. Get hard money rental property loans and start making money today!

Frankly, conventional money is hassle and is incapable of funding the large majority of the quick paced real estate investments that are constantly in motion. Hard money is a reality when it comes to rental properties, snatching the right real estate, and renovating to increase profits.

Thus, many turn to hard money lenders because hard money rental property loans have less stipulations than conventional lenders. To receive such a loan as this, a borrower must have enough cash down, 20% to 60%, to create a favorable loan-to-value situation for his or her lender. Otherwise, he or she will need to leverage current real estate assets owned to mitigate the lender’s risk. By leveraging property, especially with excellent positive equity or with no debt owed, up to 100% LTV is possible.

On top of this, previous credit issues such as bankruptcy, foreclosure, and delinquency can be overlooked in favor of an optimistic equity situation. Don’t worry about the past, it is time to live in the glory of the entrepreneurial present. Another benefit of using hard money rental property loans, is that you are able to buy distressed property. This is a benefit if you are interested in renovating to rent a house since purchasing a house is cheaper than purchasing other refurbished units in an area. Though this may take honing a few more skills and becoming one with your inner weekend warrior, many are able to get more returns by paying less in these instances. If hard money lending seems right for you, talk a hard money broker at Level 4 Funding today.

Make More Money with Rental Property Loans

Rental properties are also attractive for a number of reasons: they are a great way to establish equity, home ownership, long term cash flow, and even a retirement. Rental properties are secure in recessions when renting becomes more common. Furthermore, rental property loans to finance acquisition and renovation are not hard to come by and form a great starting point for new investors.

Talk to a hard money broker at Level 4 Funding to get your rental property loans today!

Talk to a hard money broker to find the rate, term, and loan-to-value needed for the rental investment. After acquiring the property and getting funding to renovate through rental property loans, find renters and establish a lease rate that allows for paying off the active hard money loan.