Hard Money Loans

Great Investment or Money Pit? Watch for These Two Problems

 

Currently the housing market offers great buys for investors. However, sometimes a house is not as it appears. Naturally, you want houses that are in good condition, or need a small amount of work, to be able to make a fast turnaround. Unfortunately, many times something is not discovered until after the purchase is completed.

A foundation is the basis of any house and must be in excellent condition if you expect to avoid spending a great deal of money having it replaced or repaired. When looking at the house check the foundation for cracks, crumbling cement or other conditions that will indicate a problem.

Mold in the crawl space or other locations in the house will indicate a leaking water pipe. Molds gradually destroy the things they grow on. They can damage building materials, especially under the floor. In addition, studies have shown it can cause the occupants health problems.

Having a licensed home inspector is a good investment to avoid expenses that can often cause a home purchase to become a money pit.
Do You Need a Hard Money Loan to Buy an Investment Property in Atlanta?
If you’re looking for a hard money loan in Atlanta, we may be able to help you.

Call us at 404-814-1644 or contact us online to find out whether you might qualify for this type of funding. In the meantime, check to ensure that you meet our loan criteria. Our loan amounts can be up to 65 percent of the after-repaired value of the collateral—and if you use the loan for renovation or construction, the loan amount can be based on the collateral’s improved value.

Read our frequently asked questions and take a few minutes to learn about the hard money loan process.

Foreclosures in Atlanta

Because Atlanta foreclosures are higher than usual – they’ve been on an upswing since January – that means there’s more opportunity for you, as an investor, to take out a hard money loan and pick up a property that you can flip. The selection is better, and you’ll likely spend less money than you would when properties are few and far between.

Is Foreclosure Investing Right for You?

Investing in foreclosures isn’t for everyone. In fact, many experts recommend that you gain some experience in traditional real estate investing before you dive in headfirst.

Here’s what you need to know:

There are three ways to buying foreclosures: from a property owner before it’s foreclosed (known as a pre-foreclosure), at an auction, or from a lender after the property has been repossessed.
Buying a property that’s owned by the lender may pose less risk to you than buying a foreclosure in the other stages.
You always need to check the title before you buy any foreclosed property; if you don’t, you could be taking an unnecessary risk with your money.

Need a Hard Money Loan to Invest in Atlanta Foreclosures?

Getting a hard money loan in Atlanta may be easier than you think. If you’re ready to invest in a foreclosure and you already know what it entails, give us a call at 404-814-1644 or fill out our easy hard money loan application. We may be able to get you the funding you need to make the investment of a lifetime.

What to Ask Your Hard Money Lender

Whether you’re working with a hard money lender for the first time or you’ve been through all this before, it’s a good idea to do some homework. Here’s what you need to ask:

How long have you been in business?
How big is your company?
What is the interest rate on an Atlanta hard money loan through you?
What are the terms?
How soon will the money be available?

The main purpose of the first two questions can help assure you that you’re working with an honest lender. It’s best if you work with someone who’s been in business for 10 or more years, as well as someone who’s extremely established in the industry. (Paces Funding is the largest hard money lender in Atlanta.)

You may not be very experienced with hard money loans, so it’s very important that you work with someone who is.

The other questions help you determine whether you can afford the loan and how much it will cost you over time, and they’re pretty standard to ask when you take out any loan.

Do You Need a Hard Money Loan?

Call Paces Funding at 404-814-1644 or fill out our easy online application. We’ll be happy to answer your questions and help you get the money you need quickly.

 

How Do Hard Money Lenders Work?

Hard money lenders take a different route when lending than traditional lenders do – and that can be very beneficial to real estate investors.
How Do Hard Money Lenders Work?
Hard money lenders typically lend based on collateral, so they’re less inclined to worry about the lender’s ability to repay the loan than a conventional lender would be. The value of the collateral often outweighs the borrower’s financial position.

Conventional lenders show extreme interest in credit scores and income, whereas those things aren’t as important when you’re taking out a hard money loan (they’re still important, but they’re not always “deal-breakers”). A solid borrowing history and proof of an ability to repay the loan can be enough to give you the green light. For many people, the traditional loan process can be slow (even with ample income and favorable credit scores). A negative item on a credit report can delay, or even prevent, the borrower from getting approved.

The borrower can expect a hard money loan to be short-term; the maximum term is usually around 5 years. Interest rates for hard money loans may also be a little higher than traditional loans. However, hard money loans do come with benefits.

Speed of Lending – Borrowers can expect the lenders to close quicker. Hard money lenders can close deals that other lenders cannot.
Flexibility – Borrowers are not subject to a traditional underwriting process. Hard money lenders evaluate each deal separately.
Loan Approval – For hard money lenders, one of the most important factors is the borrower’s collateral. The lender can lend as much money as the collateral is worth.

Do You Need a Hard Money Loan to Buy an Investment Property in Atlanta?
If you’re looking for a hard money […]

  • do you want your real estate agent to call you a motivated seller
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    Do You Really Want Your Realtor to Call You a “Motivated Seller”?

Do You Really Want Your Realtor to Call You a “Motivated Seller”?

Buyers see all kinds of language in listing descriptions, and some of it can be pretty confusing. However, the term motivated seller isn’t very confusing. It says that the seller really wants to unload this house—but do you really want your Realtor® to call you a motivated seller, or will it hurt your chances of selling the home at the right price?
Do You Want Your Realtor to Call You a “Motivated Seller”?
When a buyer sees the term motivated seller in a listing description, it could mean that:

You’re willing to negotiate on the price
You want to negotiate
You’re willing to make concessions to a buyer
The house is about to be foreclosed on
The house is falling down and you want out
You want to see any and all offers

While these don’t always apply to so-called motivated sellers, that’s what buyers can think—and if none of those fit your situation, you may not want your Realtor to encourage low-ball offers or get potential buyers to try to negotiate with you.

Your best bet is to talk to your Realtor about the kind of language he or she is going to use in your listing description. If you see something you don’t like, ask your agent to change it before the listing goes live—it really is that simple.
Do You Need a Hard Money Loan to Buy an Investment Property in Atlanta?
If you’re looking for a hard money loan in Atlanta, we may be able to help you.

Call us at 404-814-1644 or contact us online to find out whether you might qualify for this type of funding. In the meantime, check to ensure that you meet our loan criteria. Our loan amounts can be up to 65 percent of […]

3 Common Attic Problems Investors Can’t Afford to Ignore

Before you buy a house to flip that looks like a great deal, make sure you and your home inspector check the attic. There are a handful of serious problems you can discover up there, including truss or rafter damage, old fire damage, or insulation problems.
3 Common Attic Problems
Your inspector should peek in at the attic, and here’s what he or she will be looking for:

Truss or rafter damage. This doesn’t necessarily show up when the inspector is on the roof—but beneath the roof, an inspection can uncover stress cracks that could lead to the loss of the roof’s integrity.
Old fire damage. If a seller doesn’t disclose that the home once caught fire, an inspection in the attic can tip you off. The inspector will check to see if the rafters are painted or don’t have a natural wood appearance, which can both be signs of a previous fire in the house.
Insulation problems. Your inspector will make sure the insulation in the attic is facing the right way and determine its R factor (that’s how insulation is rated) to let you know whether it’s high (the higher it is, the higher its insulating factor).

Do You Need a Hard Money Loan to Buy an Investment Property in Atlanta?
If you’re looking for a hard money loan in Atlanta, we may be able to help you.

Call us at 404-814-1644 or contact us online to find out whether you might qualify for this type of funding. In the meantime, check to ensure that you meet our loan criteria. Our loan amounts can be up to 65 percent of the after-repaired value of the collateral—and if you use the loan for renovation or construction, the loan amount can be […]

3 Ways to Improve a Flip’s Value

When you’re flipping a house, you want it to be as valuable as possible—that way, you can make the best profit.

So what do buyers want you to do?
3 Simple Ways to Increase a House’s Value
First things first: You’ll need to work with a Realtor® who can help you price the home properly and sell it quickly. You don’t want to leave the house sitting on the market for too long.

Before you get to that stage, though, here’s what buyers want you to do.

Cut energy costs.

Buyers don’t want to spend a fortune on utility bills, so if you’re including appliances, make sure they’re the green kind. You can go a little farther than that, too, by asking the local energy company to come out and give you a free energy audit; they’ll tell you what you can do to maximize energy efficiency.

Plant some trees—or at least some shrubs.

As landscaping improvements that improve and mature over time, trees and shrubs are a great investment. If you can boost the curb appeal of the property by helping buyers feel more connected with nature, all the better.

Install a water filtration system in the kitchen.

If you’re up for it—and if your market will support it (talk to your Realtor first)—install a water filtration system in the kitchen. It’s a selling point: No more bottled water, and you know exactly where it comes from.
Do You Need a Hard Money Loan to Buy an Investment Property in Atlanta?
If you’re looking for a hard money loan in Atlanta, we may be able to help you.

Call us at 404-814-1644 or contact us online to find out whether you might qualify for this type of funding. In the meantime, check to ensure that […]

What is After-Repaired Value?

When you’re taking out a hard money loan in Atlanta or any of the surrounding communities, you need to know that the loan can be based on the after-repaired value, or ARV, of a home. But what is ARV, and how does it affect your loan?
What is After-Repaired Value?
A home’s after-repaired value reflects the property’s value after it’s been fixed up—not its value in its current condition.
How is ARV Calculated?
In order to calculate a house’s ARV, a skilled appraiser will figure out its current value (based on its current condition, as-is). Based on a list of repairs the appraiser notes, experts estimate the home’s value if all the sub-standard conditions are repaired. That’s done by finding comparable properties in the same area, just as any appraiser would do if a home didn’t need to be rehabbed.
Do You Need a Hard Money Loan to Buy an Investment Property in Atlanta?
If you’re looking for a hard money loan in Atlanta, we may be able to help you.

Call us at 404-814-1644 or contact us online to find out whether you might qualify for this type of funding. In the meantime, check to ensure that you meet our loan criteria. Our loan amounts can be up to 65 percent of the after-repaired value of the collateral—and if you use the loan for renovation or construction, the loan amount can be based on the collateral’s improved value.

Read our frequently asked questions and take a few minutes to learn about the hard money loan process.

 

  • should you hire a property manager for your investment property in Atlanta
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    Should You Hire a Property Manager for Your Investment Property?

Should You Hire a Property Manager for Your Investment Property?

There’s no denying that real estate investing can be profitable (if you’re good at it), but there’s usually a lot of blood, sweat and tears involved. If renting homes is your thing, but you find that you’re just not into unclogging toilets, or don’t have the knack for finding the perfect tenants, should you throw in the towel? If so, you may want to consider hiring a property management company.

If you’ve invested in multiple properties or are just simply making enough money (that’s the goal, right?), hiring a company to take some tasks off your plate may give you some time to look into future investments. So, how do you find the perfect property manager? Here are some questions you can ask them:
Question 1: What are your fees? Do you charge a monthly rate and are there additional fees for things like finding tenants?
Some companies charge a flat monthly fee even if your property is left vacant. Others get paid a percentage of the rent collected.
Question 2: Are you licensed and insured?
You’ll want to make sure the company is licensed and insured in case of legal or liability issues.
Question 3: How do you vet prospective tenants?
Make sure their requirements include background and credit checks, as well as payment histories, so you don’t end up with tenants who don’t pay.
Question 4: What is the best way a tenant can reach you?
Having an accessible property management company is necessary for a healthy relationship with tenants. They’ll need to know they can reach out when issues arise.
Question 5: How can I end our contract?
If you find that your management company is not working out properly, you should be able to move on. Read the contract thoroughly before […]

Commercial vs. Residential Loans

 

The differences between commercial hard money loans and residential hard money loans may seem cut-and-dry, but there are some big differences you need to understand because they’ll impact which type of loan is right for you.
Differences Between Residential and Commercial Hard Money Loans
Residential mortgage loans are intended for properties that have one to four family units. Anything above that, or a property intended solely for business (not a dwelling), falls under a commercial loan.

When you require a residential loan, your personal income, debt and ability to repay a loan are reviewed before you’re approved for a mortgage. If you need a commercial loan, the property itself is evaluated for past income and expenses. This usually requires a few years of historical figures. Your lender will want to see the income that can be generated from the building, compared to what will be owed.

It is important to note that if you’re interested in obtaining a residential loan, and wish to put it under the name of a limited liability company (LLC), you may not be able to. Lenders are under strict guidelines as to which type of loan they’re able to offer an LLC. There may be an opportunity to transfer at a later time, but you would need to consult your attorney or lender.
Do You Need a Commercial or Residential Hard Money Loan in Atlanta?
If you’re looking for a hard money loan in Atlanta, we may be able to help you.

Call us at 404-814-1644 or contact us online to find out whether you might qualify for this type of funding. In the meantime, check to ensure that you meet our loan criteria. Our loan amounts can be up to 65 percent of the after-repaired value of the collateral—and […]