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Private real estate financing means getting a short-term mortgage through a private business or individual in order to buy, carry out improvements on or refinance a property. In contrast to loans from banks, New Jersey private mortgage loans close fast, are easy to qualify for and obtainable by self-employed borrowers.
That's great for investors considering that even a person with poor credit can qualify for private money for a real estate loan provided that he has a project that shows promise, he has sufficient cash for a down payment, he has shown himself capable in earlier real estate investments, and has a sensible exit strategy. And having fast closings of 14 days, private real estate mortgages in New Jersey are the right alternative for ambitious real estate investors.
Most borrowers talk with New Jersey private mortgage lenders when:
They want money to fix a home and property and sell it for a higher price point or to rent it out for more money.
Real example: one of our borrowers held a two-family rental. He previously built ample equity in the property and the monthly rent checks was a routine revenue stream. While a few remodeling work to the property might have helped him collect higher rent, a bank would definitely have turned down his mortgage request, since his credit score was a mere 520. Right after he got into contact with Island View Private Loan Fund to obtain a mortgage, we were happy to complete a cash-out refinance for 65% of the property's appraised value.
They need to consolidate their personal debts.
The majority of people find it stressful to make countless payments each month. On that basis, many individuals do a loan from their home's equity to combine their financial debts into one single loan.
They want to use the existing equity in their current property to do a different real estate project.
One of Island View's customers in Hawaii owned a property valued at $1.2 million. He wanted to sell the house but that did not happen and he ultimately was forced to be satisfied with leasing the property to someone, with an option to buy at a later date. The rent amount was enough to cover his ongoing mortgage payment, property taxes and homeowner's insurance payments. In addition, he was given a $200k non-refundable advance payment for the 3 year lease agreement. These sureties meant he no longer had to be concerned about the home's future financial obligations, and so when another promising real estate opportunity came up, he came to IVPLF and obtained a private mortgage loan at seventy percent LTV. This means that he was able to make his down payment for his next investment, and also repay his current mortgage.
The balloon payment for a prior loan is due and they cannot afford it.
If an unexpected incident prevents someone from hitting his balloon payment due date, he could find another loan provider to refinance. A refinance can help the borrower avoid missing the cut-off date for the balloon payment and avoid fees and penalties.
Interested in discussing your financing options with a private mortgage lender in New Jersey? Fill out the form on this page or give us a call and let's discuss the property or properties you have in mind.
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