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Imagine you've encountered this truly good deal for a fix and flip property located in an ideal location, and you're either an experienced real estate investor or a newbie who hopes to try out flipping houses. You've probably heard that professional property flippers, much like the husband and wife on HGTV's Flip or Flop, turn a remarkable average return of around $40,000 - $50,000. And without a doubt, they are helped in a big way via their professional experience, auction abilities and knowledge of hard money loans. That said, you have recently been brushing up your rehab and renovation skills, have a very good licensed contractor ready to go and are confident that you can do a great job on this home.
But how exactly do real estate investors find capital? A standard lender, like for example a bank, takes no less than 1-2 months to consent to the loan and hand over the cash. So if you happen to be expecting a fast closing, it is important you recognize that this could cost you a few weeks, causing you to miss out on the home.
With banks introducing harder loan requirements in the past several years, it is now tougher for a self-employed person to obtain a home loan, particularly if his credit situation is not optimal. So does this leave you with no option, but to give up your ambition of getting into flipping? By no means, considering that you can always go the West Virginia hard money loan route to pay for your home renovating project.
If you decide to put in an application for a hard money home loan in West Virginia, you will get what's probably most vital to real estate negotiations across the country — a fast closing of about 2 weeks. Besides that, hard money lenders can do lending up to 70% LTV of the home value, as determined by a credentialed third-party appraiser. Some people consider hard money real estate loans to be more costly than standard financing, considering lending rates for such loans ordinarily start at 10%. But the term lengths for these loans are relatively shorter, making the rate far less significant. Short-term loans of several months to a few years are best understood as cost of capital, much like every other financial outlay involved with a project. After you remodel and sell off the house, recuperating this expense is no different than recouping the money you spent for home appliances you installed in the place.
Additionally, it is simple to be eligible for a hard money mortgage, regardless of whether your credit score is not that great. The borrower's credit score isn't the sole determining factor for West Virginia hard money lenders — additionally, they consider the property, its market valuation, its location, and its capability to earn back their investment if things do not work out as planned. The total amount that a person can put down in advance towards the home, how much experience he has in real estate investments, and selling price of equivalent properties in the same vicinity are other details that go into ascertaining an applicant's suitability for a hard money real estate loan.
So if you have found a really great home to flip with a huge potential for returns, you have also discovered a hard money lender in West Virginia that's prepared to provide financing for your flipping venture. Complete the contact form on this page or get in touch with us via phone and let's talk about the project you have in mind.
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