Dennis Dahlberg - It Can't Get Better Than This!

Sunday, March 24, 2019

Tips for Securing Arizona Rental Property Loans

It is always helpful to have a few tips when you are getting into a new business. These tips will help you to secure your first Arizona Rental Property Loans as you work to grow your passive income.

Even with the housing market well on its way to recovery after the crash, there are still some great deals to be found for real estate investors who are looking to create a portfolio of rental properties. But in many cases, these would be investors are not familiar with the process of securing Arizona Rental Property Loans. These tips can guide new investors on the path to a very profitable real estate investment career.

The first important piece of information for new real estate investors is that they will need to make a pretty healthy down payment to secure a loan for an investment property. This is because mortgage insurance does not cover investment properties. This means that lenders will require at least a 20% down payment. But if you can manage to make a 25% down payment you are likely to qualify for a better interest rate, which will allow you to enjoy a savings on interest over the entire life of the loan.

Another way to save yourself some money is to do everything that you can to increase your credit score before applying for Arizona Rental Property Loans. Most lenders are looking for borrowers to have a credit score of 740 or better for a loan on an investment property. If your credit score is lower than 740, you will have to pay anywhere from .25 to 2 points as an added fee to receive the lowest interest rate possible. You can request a quote for the total cost of the loan at the various interest rates, as well as the fees to buy down the interest to verify exactly how much you will save by reducing the interest rate.

Think Creatively

When you are seeking financing on an investment property be sure to check out all of your options. You could find that a private lender, a personal loan, or peer to peer lending is a better option than a traditional loan. And when you are exploring your options for making a substantial down payment, you should consider using a home equity line of credit, credit cards or even refinancing your personal home to use that equity for the down payment on your first investment property.

Finance Like A Pro

Loans for income properties are not quite the same as traditional mortgages for your family home. But using just a few tips to secure your first Arizona Rental Property Loans can help you to get a solid start on your real estate investing career. As with any financial decision, the more information that you have the better your decision will be. Invest the time in exploring and researching your options to begin your career as a rental property owner with as solid a foundation as possible. The reward for your time and hard work will be a great return on your investment and financial security.

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 and 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

Saturday, March 23, 2019

7 Options for Arizona Rental Property Loans

Many new real estate investors are unaware of their options for borrowing. But exploring these seven options will allow borrowers much more flexibility when securing Arizona Rental Property Loans.

As a new or prospective real estate investor, you might not have any idea that there are over half a dozen options for you to consider when you are seeking Arizona Rental Property Loans. But for the savvy investor, there are a lot of options besides the standard conventional mortgage from a traditional bank or mortgage company. Which is very good because banks often have very stringent criteria for lending' which makes it difficult to get a bank loan for an investment property.

A fix and flip loan is a short term loan that is often used for an investment property. These loans are not as difficult to secure as a traditional mortgage because the property is used to secure the loan. But the lender does still look at the borrower's credit score to determine if the borrower will qualify for the loan. Arizona Private Money Lenders are another resource that is very similar to the fix and flip loan. These are people who make loans based on the value of the real estate being purchased rather than the borrower's credit score. These are also short term loans, but they are much easier to qualify for.

Seller financing is another great option for Arizona Rental Property Loans. In this case, the buyer is making an agreement with the seller to make monthly payments on the property. The terms of the contract are similar to a traditional loan, but a loan from a seller can be more flexible with some of the terms. If the seller is not interested in providing financing then you might also want to consider a real estate partnership. In this case, you can determine who to partner with, and what that person’s contribution will be. Some partners only provide cash and remain silent regarding the function of the business, while others are actively involved in the investment business.

Finance Yourself

If you own a home then you also have the option to finance a loan to yourself. In this process, you would secure a home equity loan against your personal home or a home equity line of credit. This is like getting either a second mortgage on your home to use the equity or a new mortgage if your home is paid off. Finally, many 401K accounts are structured to allow you to take out a loan against your retirement savings. If you have a 401K that offers this feature, then that is the perfect way to finance a rental property as you are paying the interest to yourself as you pay back the loan.

Explore All The Options For Arizona Rental Property Loans

As a real estate investor, the only priority that you have is to get the best deal possible on a loan so that you increase your profits. No one type of loan is perfect or will fit every borrower’s needs. Investing time in research will pay off when it comes time to calculate your return on investment so that you can make an additional purchase and grow your business.

What Are 90% Arizona Hard Money Loans?

If you are not familiar with Arizona Hard Money Loans then the term 90% Arizona Hard Money Loans is sure to be confusing. But with just a little information you will learn how these loans can help you make a great deal of money.

Many borrowers are under the misguided conception that Arizona Hard Money Loans are loans that operate on the fringe of legality and are considered shady at best. But that could not be further from the truth. A hard money loan is simply a short term loan which is offered by a private lender. Unlike traditional loans from a bank or mortgage company, Arizona Hard Money Loans are asset-based loans. This means that the qualification for the loan is not solely based on the borrower's credit score. In the case of hard money, the loan to value ratio, or LTV, is actually more important than any other factor.

The loan to value ratio is a means of measuring the percentage of a property’s value that’s being financed with the loan. The amount of the loan is divided by the property’s appraised value to determine the LTV. Most Arizona Hard Money Lenders have an LTV rate that they are comfortable funding on the average property. In many cases that number is about 75% of the value of the property. This limit is built-in protection for the lender in the event of the borrower defaulting on the loan. If the loan is never more than 75% of the value of the property, then the lender is relatively certain to be able to recover all of his or her investment should it become necessary to take possession of the property due to default on the payments.

The remaining 25% of the value of the property is basically the equity that the borrower paid in a down payment. This is also good for the borrower as the instant equity can be used to secure funding for renovations in the case of a fix and flip. The equity also represents less money that the borrower is paying interest on.

90% Arizona Hard Money Loans

In the case of 90% Arizona Hard Money Loans, these are a great deal for borrowers because they are offered the opportunity to borrow a full 90% of the value of the real estate that they are purchasing. These loans often have a bit higher interest rate due to the higher LTV, but many borrowers are willing to pay more interest. These loans are typically very appealing to first-time real estate investors who do not have a large sum of cash to use for a 25% down payment.

Great For First Time Buyers

Another group that benefits from 90% Arizona Hard Money Loans are first time buyers. These loans allow first-time buyers to finance 90% of their purchase and have the money quickly. Then the buyer has the opportunity to shop around to secure a traditional mortgage or to refinance for a longer term with the private lender. Being able to finance such a large percentage of a real estate purchase with a private lender can offer many huge benefits to a wide variety of borrowers.

The 4 Best Types of Fix and Flip Loans in Arizona

Property flipping has become very popular in the last few years. But many real estate investors have no idea how to best finance Fix and Flip Loans in Arizona.

Over the last several years there have been dozens of television show demonstrating the process of buying, fixing and flipping homes. But what those shows gloss right over is the correct process for funding Fix and Flip Loans in Arizona. Not everyone has $100,000 sitting around to start a real estate investing business. But there are a few pointers that can help anyone who is interested in entering the real estate investment business when they are just starting out.

The important fact to remember is that if you are using a traditional lender, you will need to have access to enough cash to cover at least 20% of the purchase price of the property. This is because mortgage insurance does not cover investment properties. If you are using a less traditional lender, such as a private hard money lender, then the amount of your down payment will vary depending on the lender's stipulations.

Personal funding covers a lot more than just what you have sitting in savings. In some cases, you can borrow from your retirement account to fund a down payment for Fix and Flip Loans in Arizona. In other cases, you could use a personal loan, a loan from family or friends or even a home equity line of credit on your personal home. Other real estate investors partner with someone who will do nothing more than provide funding while they do the work on the house flipping.

A Professional Loan

If you have created a business to do your house flips, then you might also be able to secure a small business loan to use for funding down payments and other expenses. You could also secure a business line of credit that would allow you to keep the credit available for future purchases. Hard money is another option that is very popular for Fix and Flip Loans in Arizona. These are short term loans that are offered by private lenders. The loan is secured with the property that you are purchasing rather than your personal creditworthiness. Because hard money is asset-based, these loans are much easier to qualify for and will fund in as short as a week or two. Many borrowers also like to work with Arizona Private Money Lenders because they are able to customize the terms of the loan to best meet their specific needs.

Do Your Homework

There are many different options available to fund a house flipping business. And not all of the loans are going to be from a traditional lender or even from a professional lender. Using your personal resources such as friends and family, as well as your personal credit can often be enough money to get the down payment for your first flip property. Then you just need to be diligent and remain on schedule to complete the property and sell it to fund your next fix and flip.

Friday, March 22, 2019

The 4 Best Types of Fix and Flip Loans in Arizona

In most cases hard money is used to purchase an investment property. But there are cases when owner-occupied Arizona Hard Money Loans are funded by some lenders.

Not everyone has the credit history or even the documentable income to qualify for a traditional loan from a bank or a mortgage company. But these consumers need a place to live and can grow very tired of renting a property. Most people look at renting as paying a mortgage for the property owner and improving the property owners financial future rather than their own. As a result, many of these renters look for alternative resources which will allow them to purchase a home and begin to build their own financial security. Owner-occupied Arizona Hard Money Loans are one way to finance a home purchase that is truly creative.

If you are unable to verify your income or to show a stable and regular income level, then securing a traditional loan will be nearly impossible. It can also be a challenge to get a loan when you have no credit history or a bad credit history. But Arizona Hard Money Lenders are more interested in the value of the property that you are buying and less concerned with your personal credit. Asset-based lending is all about the property condition and value. The loan to value ratio is used to determine how much the lender is willing to offer you, and the property you are purchasing is used to secure that loan. The qualifications are much easier than those of a bank loan.

Because owner-occupied Arizona Hard Money Loans are provided by private lenders, the terms of your loan could vary but there are some fairly standard terms that you should expect. The down payment is normally between 20 – 30%. This is to create instant equity and help to protect the borrower's investment. Some lenders will also allow co-signers on Arizona Hard Money Loans. Some Arizona Hard Money Lenders are also willing to work with you to allow for seller financing on the down payment so that you do not need to have such a large amount of cash to close the deal. And when you begin to see offers, expect to see the interest rate at just under 10% at best. Depending on the LTV, the condition of the property and your current financial health, the rate can be several points above the 10% mark.

Other Reasons for Owner Occupied Arizona Hard Money Loans

Some hard money borrowers are first time home buyers who just need to build a credit history. Others have poor credit and need the opportunity to rebuild good credit. Other borrowers just want to refinance an existing loan or need to refinance for some reason. Refinancing might be the only way to make needed repairs or to remodel the property. While other borrowers are looking for a way to consolidate their debt.

Do Your Homework

Using hard money to finance the home that you are living in could be costly, but it certainly has several benefits over continuing to rent and pay someone else ’s mortgage and build their equity. As with any financial choice, do your research and only make a decision when you feel that you fully understand all of your options and have found the one that best meets your needs.

Terms of Owner Occupied Hard Money Loans in Arizona

Not every real estate investor uses traditional lenders or even traditional loans to purchase rental properties. There are many ways to creatively finance Arizona Rental Property Loans.

Many investors do follow the traditional path of saving for a down payment and then securing a traditional loan from a bank or a mortgage company, but there are several other ways to creatively fund Arizona Rental Property Loans. Exploring all of your options for financing your first rental property or one later in your career is always a smart move. In some instances, you might need to be creative to land a great deal, even when you are not in a position to seek traditional funding.

Seller financing is always a great option if you can get it. In many cases, you will make a down payment to the seller, and then continue to make payments just as you would to a bank or other lender. In some cases, the lender will only carry a small part of the purchase price, and you will use traditional financing for the remaining balance of the loan. One of the big benefits of owner financing is that you can work with the individual to create loan terms that work well for both of you and are beneficial and fair to both of you.

Investment partners are another common way to fund Arizona Rental Property Loans. Many real estate investors who are new to the business just don’t have the money to cover the 20% down payment required for an investment property. This is because mortgage insurance is not offered on an investment property mortgage. So the solution is to seek a silent partner who contributes the cash for the down payment and then earns a little bit on his money. Sometimes you will even get lucky and find a partner who will contribute money and work to the project.

Fund Your Own Rental Property Purchase

Many real estate investors have a retirement account that is just sitting there waiting to be used. The account is earning interest, but it could also be used to help you start your real estate investing career. Some 401K retirement accounts will allow you to take out a loan from your account to start a business or for other financial needs. If your retirement account offers this feature, then you can fund your own down payment and possibly even the entire purchase. And the best part is that you are paying the interest on the loan to yourself.

Research Your Options

There are many creative ways that you can finance Arizona Rental Property Loans. The only really important factor is that the loan and the terms work for your immediate needs and future needs. Taking a very high-interest rate is sometimes worth the added cost to secure a property that will make you a great deal of rental income for many years to come. Explore your options, and only make your decision based on the cost of the loan and the benefits that it offers you.