Real estate Investment Loans, New Jersey

HARD MONEY AND LOANS FOR REAL ESTATE INVESTMENT PROPERTIES

Becoming a professional real estate investor is an excellent way to generate passive income. However, if you don’t have extra cash lying around, you will need financial help. Taking out a loan for real estate investment properties is a good option. There are several different kinds of loans you can choose from. So all real estate investors need to understand how different types of loans for real estate investment properties work before contacting a lender. In today’s article, our team from Real Estate Funding Solutions will explain to you in detail how hard money and private money loans work to help you, a real estate investor, figure out which option works the best for your situation. However, if you have any other questions about real estate funding, feel free to contact our team.

Hard Money for Real Estate Investment Properties

You can get hard money loans for real estate investment via a professional individual or firm that lends money specifically. The best quality about such loans is that they are much faster and easier to secure, especially compared to other lending options, such as conventional real estate loans. Moreover, hard money lenders for real estate investment properties don’t look at your credit score to decide whether they approve your loan. Instead, they will evaluate the current and future value of the property you plan to purchase to figure out if they should grant you the loan. Even though hard money loans are among the most common types of loans for real estate investment, they tend to come with a list of documentation, formalities, and guarantees. If you are a real estate investor looking to get a hard money loan, you must remember that they are short-term loans that go up to 36 months. Hard money loans also come with a higher interest rate of almost 10% higher than a conventional mortgage.  

Hard money loans for real estate investment are a great financing option for investors aiming to purchase cheap investment real estate, renovate it, and quickly sell the property for a profit to pay off their due on time (also known as a fix-and-flip strategy). Because of this, such loans are not ideal for any income property. On the other hand, you will not pay off your hard money loan on a long-term investment property in just three years. A good property investor will evaluate the property’s overall profitability and ARV (after repair value) before considering such loans to ensure they don’t end in a financial issue later. 

Private Money Loans

You can easily find private money lenders (friends, co-workers, family, neighbors, etc.) or other property investors and individuals you’ve met in your real estate investing career. Ideally, private money lenders are not professional real estate lenders like hard money lenders. Instead, they have access to extra money and wish to get a good return on their investment. Such loans for real estate investment properties are perfect for investors who got turned down by big banks and other financial institutions. Private money loans also come with fewer formalities, especially if there is a close relationship between the investor and the lender.

Moreover, private money loans don’t involve any strict conditions, feature lower interest rates typically, and the total length of your loan will be negotiable and flexible. However, as an investor, you must remember that these loans for real estate investments are often secured by the existing mortgage on the income property or a promissory note. Therefore, if an investor defaults on loan, a private money lender can foreclose.  

If you are having difficulty finding a private money lender for your next big real estate purchase, you can contact Real Estate Funding Solutions right away. We have a team of professional real estate experts who can help you find ideal loan terms for your upcoming real estate purchase. We will also make sure you understand all the terms and conditions of the loan before finalizing a deal. Our team can help you glide through acquiring a real estate loan with ease. 

Have Any Questions Regarding Investment Property Loans? Contact Real Estate Funding Solutions Right Away!

The Real Estate Funding Solutions team has years of training and on-field experience. It enables us to help you fully understand all your options and determine which one fits your wants and needs the best. Our expertise also enables you to find an ideal deal that ensures you stay profitable after your loan terms end. Moreover, our team will ensure you have a good credit score and help you gather all vital documents for your loan application. We will stay by your side until closing, ensuring you don’t have any issues along the way. Want to get professional help with your next real estate investment purchase? Call us today at +1 855-913-8637 to get started. 

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