hard money loans

Funding Your First Hard Money Loan

finding-aid-for-foreclosure-through-hard-money-loans

This post includes some Key Factors in investing, especially for all ‘new investors’. In fact, anyone that is planning on investing using a ‘Hard Money Loan’ should Read This First!

Real Estate investing for the first time using a Hard Money Loan

The most important deal in your career of real estate investing is going to be that first investment. That first real estate investment, because it’s that first investment you do in purchasing real estate that will open doors for you. Generally, that first investment has more of a success rate with those who use a Hard Money Loan.

Why is the first real estate investment more successful with a Hard Money Loan?

The answer is simple: New investors have trouble in getting their first loan or two, until they have established a little capital, and a Hard Money Loan is basically the only type they will be able to get until that happens. It’s best to think in terms of a tourist when investing, that is to say; New investors who are about to invest in real estate needs to think in the same matter as a tourist thinks when planning to take a trip.

New investors need carefully plan all the right moves, deciding on the strategy to use, how to get the most for your money, which real estate is going to bring in the most profit for the least amount, and etc., another important factor would be what is the real estate’s value on the market. Keep in mind, that it is much easier to get a Hard Money Loan in some states that it is in others.

This is partly due to the different variations of the real estate laws in each state, many of which seem to be hostile towards investing in real estate, as well as being against the process of the Hard Money Loans. Of course, with due process of the law being put in place by our very own congress, I’d say that is where the blame should be pointed.

In other words, it will help to learn of all the different states and their laws on real estate investing, knowing what’s going to be there for you when doing investments in those states, and know if they are going to be available to you when investing in real estate using the Hard Money Loans.

Learn what the states are more likely to approve the Hard Money Loans, and know the hottest areas for new investors are. Don’t forget to check-out how they are doing in the market, and the places you’re more likely to be approved for the Hard Money Loan.

7 Best Arizona Cities For Real Estate Investments

The best Arizona cities for real estate investments, might surprise you.  If you’re looking for the best markets to invest in real estate in Arizona, you’re not alone.  Arizona is a hot bed for real estate activity but these 7 cities in Arizona are the best for real estate investments.  Each of the cities in this list have been ranked by real estate guides and experts as being growth areas that should appreciate in value.

Laveen

As one of the strongest real estate investment areas Laveen boasts less than 1 percent vacancy rate.  Add to that the neighborhood has an average rental return of over 11% it’s clear why Laveen is a great place to look for real estate to invest in!

Scottsdale

Scottsdale might be part of the valley, but it is a unique suburb and attracts people from all walks of life.  With exciting nightlife, highly rated restaurants, amazing hotels, and unique western flair its not surprise that many visitors choose to make Scottsdale home.  As a desirable area in the valley the real estate investing opportunities are in no short supply!

Queen Creek

Queen Creek has grown in popularity due to both closeness to the Mesa Airport and real estate costs.  With it being such a popular area, the vacancy rate is low and returns for rental properties are virtually as high as Laveen.

El Mirage

El Mirage has benefited from growth due to its great affordability.  In fact the median home value in El Mirage is below $110,000.  The area is home to over 30 restaurants, coffee shops, and bars.  If you’re seeking a prime opportunity, El Mirage might have the property you’re seeking.

South Phoenix

South Phoenix also boasts a very low vacancy rate and healthy return rates on rentals.  South Phoenix is also close to popular attractions such as the zoo, Botanical gardens, and Tempe with Mill Ave and Tempe Town Lake.  This makes South Phoenix a great place for investors to snatch up properties to renovate, rent, or to sell.

Maricopa City

Maricopa city has also seen an increase in residents which has dropped the vacancy rate below 1 percent.  With approximately a 10 percent return for real estate investments Maricopa City is a great place or investors to seek opportunities.

Tucson

While Tucson is a ways south of Phoenix, it is still a great opportunity for real estate investors.  With 3 national forests near by, great culture, and mild climate its no surprise that Tucson is a growth market.  It attracts both buyers and renters from all over the country!

Real Estate Investment Loans

Finding the property it step one, getting it financed is step two.  Brad Loans offers real estate investment loans and gets the job done faster than traditional banks.  With programs for both real estate investments and fix and flip options our team can help you get the financing you need quickly.  As a hard money lender we also don’t require the mountains of red tape traditional banks do.  Click here to: Start your real estate investment loan application today!

Many Hard Money Lenders will ‘FORGET’ to let you know these things:


Other Hard Money Lenders are not going to be too happy about me giving this information out, however, I just feel that by not telling this it would be the same as deceiving people. I have become quite tired of hearing how some of the Hard Money Lenders take advantage of investors, yes, new investors especially. They do this by giving them information that is not in its entirety, anything that will rush the close of a deal.

What makes it worst, is when they fail to give any information at all. For example, there are expenses incurred when making a purchase for property that is not included in the loan itself, the Hard Money Lenders doesn’t mention this part up front. Lenders hardly ever will mention that there will be other fees and charges that you, the investor must come up with, and that is why this is being written on your behalf.

100% Financing, yes, there are three different types:

I have heard that most new investors thought there was only one type of loan that offered 100% financing on real estate investments, this is not true. Actually, there are three types of loans that offer 100% financing on real estate investments. You have nothing to feel awful about, it wasn’t your fault the lenders held back important information such as t his. The main reason for bringing this up now is because nobody else is going to.

If you already know this, that’s great, but, if you don’t, listen-up; only a small majority of Hard Money Loans will cover anywhere from 60% to 75% of the value on the property to be purchased and/or the value of the property after the necessary repairs have been made.

In a case where you have stumbled upon a terrific deal, the Hard Money Lender can decide to finance it 100%. Which brings us to the first type of 100% financing.

100% Financing – Type (1):

This type covers 100% the property cost, no more, no less. However, there are other fees involved, and the do add up, and  fast. Here are some of what those fees are: Closing costs, repair costs, earnest money, escrow, insurance fees, mortgage insurance fees or title insurance, among a few others that could come up.Usually, when lenders refer to 100% financing this is the one they’re referring to.

100% Financing – Type (2):


Occasionally a Hard Money Lender will finance 100% on the purchase price, plus the repair costs involved, and sometimes even the closing costs, of course, it would have to be some fantastic deal you got a hold of for this to happen. However, as the investor you would still be accountable to come up with the other fees, such as: The closing costs, earnest money, inspection fees, evaluation fees, insurances, and etc..

100% Financing – Type (3):

This one is referred to as the ‘Holy Grail’ of investment financing,. It does just what it says: Gives 100% financing that covers ‘EVERYTHING’, and I mean everything. The price of the property to be purchased, repair costs, earnest money, insurances, escrow, closing costs, ‘EVERYTHING’. This will be the only financing option available that offers the investor the opportunity to land a deal without any upfront cost out of their own pocket. You’ll not find this type of financing offered by many, yet, we offer it to you.

Before giving an explanation on how we can offer a true 100% financing to clients let’s first explore the importance of the starting money:

You could take $1,000 dollars and turn it into $10,000.

The following is an itemized table of everything:

Common Starting Money Items
Item Cost
Earnest Money $500 – $1,000
Evaluation $600
Inspection $500
Total: $1,600 – $2,100
   

These are among the most common things to be over looked during the process of a Real Estate Loan:

  • Repair costs
  • Earnest money
  • Insurances
  • Escrow
  • Closing costs
  • mortgage insurance fees
  • title insurance.
  • Home owners insurance

There are a few more of these as well…

Phoenix Hard Money Lender

Our mission is to always have your wishes and interests in mind, and our goal is to keep a satisfied customer by ‘opening the door to their financial freedom’, and so that our customers will return to us the next time they need a loan. Furthermore, we do not anticipate gain from any of customers. Our gain will come from treating our customers fairly, and in due time.

When we hold our heads up its not to look into the clouds, but because we can feel proud, and good about the way we do business. By helping you succeed the first time around, we are hoping that you will return again, and again, and even tell of your great experience to all your friends and family so they’ll also come to us.

Give us a call today if you are interested in hard money loans for fix and flip, finishing construction,refinancing your mortgage, buying land, or need loans for other investment opportunities but have bad or no credit. Give Brad Loans a call today at (602) 999-9499.

What Is LTV – Loan To Value Ratio?

What Is LTV Loan To Value Ratio

What Is LTV Loan To Value Ratio

If you’re searching for “what is ltv?“, “what is ltv ratio“,  “what does ltv mean“, or “what is a good loan to value ratio” this post will help!  LTV ratio (loan-to-value ratio) is a ratio used to determine lending risk assessments reviewed by financial institutions and various types of lenders prior to approving mortgage loans. Usually, if an assessment has high LTV ratios, they are considered to be a high risk, thus if the mortgage loan gets approved it will often be at a much higher cost to the borrower. In addition, loans that have higher LTV ratios could require mortgage insurance to be purchased by the borrower to offset the lenders high risk.

BREAKING DOWN ‘Loan-To-Value Ratio – LTV Ratio’

To calculate the LTV ratio, the mortgage lien amount is divided by the properties appraisal value, which is provided as a percentage. For instance, when a $92,500 mortgage is taken out by the borrower for purchasing a property with an appraised value of $100,000, the LTV ratio calculations would be 92.5%, or 92,500 out of 100,000.

Therefore, LTV ratios are an important part of mortgage underwriting, whether or not for purpose of refinancing existing mortgages into new loans, buying a residential property, or simply borrowing against a property’s accumulated equity.

Every lender assesses loan-to-value ratios to decide the exposed risk levels that they will have if approving a mortgage, which is calculated as delta between the total borrowed amount and property’s appraisal value. When a borrower requests a loan near or at appraisal values, the LTV ratio become higher, which is perceived by lenders as a larger risk of the borrow defaulting on a loan due to having little or no equity within the property. Therefore, in the event of a foreclosure occurring, lenders could have challenges selling the property for the sufficient amount of covering the mortgage balance while making a profit from the sell.

High LTV Ratio Implications

Although financial institutions use more than the LTV ratio for deciding on securing home equity and mortgage loans, or line of credit, it has a major role with the overall expense to the borrower. Most lenders provide home equity and mortgage applicants with interest’s rates as low as possible when the LTV ratio score is 80% or less. However, higher LTV ratios do not exclude a borrower from getting approval for the mortgage loan, but it increases the total costs associated with the loan the higher the LTV ratio is. For example, if a borrower has a 95% LTV ratio, they could be approved for the mortgage loan. However, the interest rate offered could be up to one percent point higher compared to a borrower with a 75% LTV ratio. Additionally, with higher interest rates, lenders can add on the requirement of borrowers purchasing mortgage insurance with higher LTV ratios. Mortgage insurance can greatly increase the monthly mortgage payments for a borrower, and the mortgage insurance coverage can be required until the LTV ratio is under 80%.

What Is A Good Loan To Value Ratio?

What LTV ratio is good and is able to assist with getting approved for a loan?

This will depend on the type of loan and lender’s preference. You will commonly have a higher approval chance by investing more equity, or having a lower LTV ratio.

The magical number for home loans is 80%. If you try to get a loan over 80% of the homes appraised value, you typically require a PMI (private mortgage insurance) for protecting the lender against high risk. This is an additional expense, but it can often be canceled once the borrower lowers the LTV ratio under 80%.

Additionally, 97% is another significant number. There are lenders that will allow borrowers to purchase with a minimum of 3% down, however, you will be required to have mortgage insurance coverage and could be required for the lifespan of the loan. FHA loans will require 3.5% down.

When it comes to an auto loan, the loan-to-value ratio commonly gets higher, but limits or maximums can be set by lenders, while changing rates of the borrower based on how high the LTV ratios are. There are situations where a borrower may be able to get approved with an LTV ratio over 100%.

Brad Loans Offers Up To 100% LTV With Cross Collateral

Brad Loans offers 100% FINANCING if borrower has an another property that is free and clear or the property that has positive equity (it’s worth more than is still owed), it can be pledged as additional collateral (aka a Cross Collateralized Loan). Learn more about 100% LTV hard money loans here.

Hard Money Loans With No Money Down | No Down Payment

No Money Down Hard Money Lenders | Zero Down Payment - Brad Loans

If you are searching for “No Money Down Hard Money Lenders”, “Zero Down Hard Money Lenders” or “Hard Money Loan For Down Payment” in Phoenix or Scottsdale, Arizona, Brad Loans by eMortgage can help! Our team is professional, friendly, and passionate about doing everything we can to get Phoenix Valley residents and investors the funds for the real estate they need.  If you need money for a home or real estate investment opportunity in the Phoenix Valley and want to get started with the loan application apply for a hard money loan from Brad Loans today! Fill out our hard money loan application online or give us a call at 602-999-9499 to find out if you qualify!

Hard Money Loan Application

Our Application Form is Quick, Secure, and Easy!

We offer 100% Loan To Value Loans W/ No Down Payment Using Cross Collateral!

Hard money loans with no money down or no down payment are available by using cross collateral. What is cross collateral? Cross collateral is where you (the hard money loan borrower) uses collateral as a form of security to the hard money loan provider. For example, lets say you want to purchase a property for $100,000. Usually you would have to make a down payment of 30% (Investor) or as low as 20% (Owner Occupied). For this scenario lets say you don’t have the money for the down payment or you want to use the money for renovations etc. Instead of a down payment, you can use equity as cross collateral.

No Down Payments On Hard Money Loans With Equity

Having equity (property, money, collateral) is the only way to avoid paying a down payment on your hard money loan. For example: If you own another property that is worth $80,000 free and clear, you actually have $80,000 worth of equity. In this case Brad Loans would be able to loan you up to 100% of the property purchase price with no down payment and no money down. Brad simply uses the property that you already own (your positive equity) and the property you are buying as collateral. You are basically putting your equity up as security for the loan provider instead of putting down a cash payment.

Any Additional Fees For Using Equity Instead Of A Down Payment?

Brad loans charges an additional fee of $975 for hard money loan borrowers who choose to put up equity instead of providing a cash down payment. What if I have bad credit, will you need a down payment then? No, as long as the borrower can provide sufficient collateral to cover the full value of the loan, you can still get a hard money loan with no money down.

Would you like to see if you can qualify for a hard money loans with no cash down? Have you had foreclosures in the past? Are you not a US citizen yet? Discharged bankruptcy? Short Sale? Have Bad Credit? No problem!! Brad Loans by eMortgage is a bad credit or no credit hard money mortgage lender.

How To Qualify For A Hard Money Loan W/ No Down Payment?

We have two hard money loan programs, one for investors and one for owner-occupants.  There are different features and requirements for each type of loan.  Read more below to understand how you can quality for your hard money loan with no down payment.

Loans For Owner-Occupants:

In you need hard money for a home you intend to live in, Brad can help! Here are the minimum requirement for owner occupied:

  • 20% minimum cash down payment or equal collateral
  • Cash fees for closing costs, loan fees, and prepaids
  • Refinance, equity of 35% or more required
  • Proof of income showing that less than 45% of your income before taxes will be used towards your Brad Loans payment, car payments, credit card or student loan payments.
  • Statements from your bank showing that you have the funds available for loan fees, down payment, third party closing costs etc. Also, a copy of 401(k) or IRA statements.
  • 30 days worth of paystubs, 2 years worth of tax returns, and W2’s/1099’s, or 2 years worth of bank statements as a replacement for the tax returns.
  • Must have a 45% or less debt to income ratio.
  • Valid US or Foreign ID
  • Copy of purchase contract for the residence you are purchasing
  • Title and appraisal report (ordered by us)
  • How long does it take before I get my hard money loan funded? 7-10 day funding from the date of the original application.

Regardless of credit issues you will most likely qualify for a Brad Loan if you can prove adequate income and have the down payment!

It’s just that simple.

Loans For Investors:

  • Loans for investors require a down payment of 30% or more for a purchase up to 70% loan to purchase price, or after repair
  • Cash fees for closing costs, loan fees, and prepaids
  • Refinance, equity of 35% or more
  • Show proof that you have working capital funds
  • Up to 100% Loan to Value of Purchase price when using a 2nd Free & Clear property for additional collateral (cross-collateralization)
  • Statements from your bank showing that you have the funds available for loan fees, down payment, third party closing costs etc. Also, a copy of 401(k) or IRA statements.
  • Copy of lease(s) if applicable
  • Copy of purchase contract for the residence you are purchasing
  • Valid US or Foreign ID
  • Appraisal and title report (ordered by eMortgage Inc.)
  • Title and appraisal report (ordered by us)
  • How long does it take before I get my hard money loan funded? 3-5 day funding from the date of the original application.

Find Out If You Qualify For Zero Down Hard Money Loans

Review:Brad Loans is the way to go. Easy – FAST and Friendly. I have taken 2 home loans out with Brad and both experiences were wonderful. Thank you Brad and Amber!” Desert Wide Properties.

To see if you quality for a hard money loan with no down payment in Phoenix or Scottsdale, call 602-999-9499 or fill out our 5 minute, simple ONLINE LOAN APPLICATION to get approved for a Brad Loan today.  Hard money lending is the best way to get the money you need for purchasing real estate without the harsh requirements of banks or their snail’s pace loan process.

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