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Dr. Kalinda Rose Stevenson
Commercial Banker Discusses Typical Loan Scenarios for Private Money Deals
Welcome back!
Commercial real estate, private money loans also known as hard money and or bridge loans are becoming more prevalent as borrowers enjoy less red tape, quicker closings and more “common sense” underwriting than conventional financing provides. Typically though, borrowers still relay on this type of financing as an option when conventional sources are not available.
The increased speed and flexible underwriting comes at a steep price with interest only rates often in the teens, 3- 6 points being the norm and loan terms being relatively short at 12 – 36 months.
Why would owners pay such high fees/rates? In short, because it makes sense for them based on their current situation. Below are examples of transactions where it made sense for our borrowers or go the hard money route.
Read more of the article by Jeff Rauth at
http://nomoneylimits.com/articles/privatemoney003.htm
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Why Are Hard Money Lenders Angels?
With the recent upsurge in residential foreclosures nationally, homeowners are finding themselves in a very unusual predicament. Over the last 7, borrowers with less than perfect credit fell into a category called :sub prime borrowers”. This class of borrower was able to obtain a mortgage with little or no documentation.
The lenders were all too anxious to lend money to this class of borrower. Consequently, many borrowers took advantage of possibly a once in a life time opportunity to own a piece of the American dream.
Then reality set in. Many borrowers purchased a mortgage with a negative amortization option along with interest only options. Rather than pay the fully amortized 30 year rate, they only paid the interest and in many cases paid the negative amortization rate.
Read more of the article by Leonard Rosen at
http://nomoneylimits.com/articles/hardmoney003.htm
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10 Ways To Buy A Home With Little Or No Money Down
There are many ways to buy a home, even if you have little or no money to put down. Here are a few of the basics:
1. Sweat Equity
Sweat Equity is a way to get a home by trading work for equity in the house. This could be used for a down payment or for purchase later. This is a great technique if you are handy with tools, yard-work, and paint.
Look for fixer-uppers in neighborhoods you are interested in. Many times these homes will have a hard time selling and the owner is ready for just about any offer. You will find these houses ranging from just needing a little “cosmetic” work like landscaping or painting, to totally trashed out houses in need of some serious renovation. If you are into repairs, this is a great way to get a home for a good deal.
If you are not skilled at repairs and renovation, be careful about fixer-upper homes. They could end up costing you quite a large amount of money to pay others to fix.
I also recommend getting a home inspection so that you know what exactly you are in for before you begin.
By Alexis Dey
For 9 more ways to buy a home with little or no money down, read more at
http://nomoneylimits.com/articles/nomoney004.htm
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