Author Archives: Shawn Molem

Residential Rehab Loans – The Most Efficient Way To Buy, Fix and Sell Residential Properties!

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Category : Residential Loans

Residential Rehab Loans provide great opportunities for real estate investors to purchase homes in need of renovation and rehabilitation under terms that are more flexible than traditional and long-term mortgage loans. Residential Rehab loans are very useful for those investors who have an ability to find deals but unable to fund projects with conventional financing.

There are many options available for borrowers in residential hard money loans. For example, residential construction loans allow homeowners to finance construction and home improvement projects easily and with the flexibility that conventional loans cannot provide. These types of loans are designed to help the rehabilitation of properties with real investment potential.

Here are some key features of Residential Rehab Loans:

  • No minimum credit score required for loan approval (property-based approval)
  • Funding within 5-10 business days maximum
  • No loan payments during the initial term
  • Financing up to 85% of Purchase Price and 100% of Rehab
  • Interest rates from 12% to 13% interest only
  • 2-4 points as a loan fee (based primarily on loan size)
  • Loan terms up to 12 months with no pre-payment penalty
  • Monthly payments required
  • Fast closings

Residential rehab loan is a very popular loan that many people use to fix up houses. It allows you to hang on to your savings when fixing up a broken-down house. Rehab loans are designed for “fixer-uppers.” Therefore, this loan will allow you to qualify for a home purchase that many other programs would not. You can get a house at a lower price than you normally would be able to on the open market.

The Bottom Line:

Repairs on a house can be very expensive. If you are depending on your savings, you could run out of money quickly. You might not be able to resell the house and then your savings are depleted. With a Residential hard money loan, you can borrow the money quickly on the low-interest rate with flexible loan terms and complete your project successfully to flip the house and earn profits.

Magna Capital Group, Inc. is one of the leading rehab hard money lender for real estate investors. We have many different loan programs to choose the right one for you to save your hundred of dollars on your monthly payments. We provide easy approval, fast funding, and 100% financing possibilities that make our residential rehab loans different from the rest.

Our residential hard money loans provide you with the fast funding and loan terms that you need to help you reach your real estate goals. If you are purchasing a residential property to rehab or seeking funds to rehab a property you already own, Call Us Today at (310) 734 4044 or Email at info@magnaloans.com.

Fix and Flip Loans: The Best Financing Option For Flipping Houses!

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Category : Fix & Flip Loans

Fixing and flipping houses is only one way to make money investing in real estate. A lot of people dream of getting into this business, but funding is the number one obstacle. It costs a lot of money to fix and flip houses. You need capital to purchase homes, cover the cost of renovations, contractor fees, listing and broker fees, holding costs until you flip the home for a profit.

A fix and flip loan is a great way to get financing if you’re just starting out in the housing industry. If it’s your first time, you may not have the seed money that you will need to get started. Fix and flip loans can boost you to get into this industry.

Here are some things to know before getting a fix and flip loan:

The Best Financing Option:
Obtain financing is one of the basics of fixing and flipping homes. Keep in mind that the turnaround in most of these cases is less than a year. That makes getting a flip and fix loan from a traditional bank almost impossible. Banks make their money from the interest accrued from long-term financing agreements. They don’t like having the borrowed amount paid off within a year. So if you need to get this type of quick funding, you’ll have to look for a hard money lender who will agree to a short-term deal.

Find The Right Property:
Finding the right property is the first step of flipping houses business. You must know what a house will sell for once you fix it up and how much repairs and upgrades will cost. You’ll want to find something that you can get a really good deal on, and it should also be in need of renovation. Keep an eye out for foreclosures or those homes that have been damaged by fire or water. Once you’ve found the right place, one that you think you can make a profit on, it’s time to secure a fix and flip loan.

Keep Your Documents In Order:
Make sure you have paperwork in order before meeting with someone to secure financing. Don’t forget to check your credit score to make sure that the lender won’t think that you are a risky borrower. Make sure you have all of your documents in order to show how much reserve capital you have. You should also be able to verify your income by having pay stubs, a W-2, and tax returns on hand.

Understand Financial Calculations:
Financial calculations are different in fix and flip loans as it’s not a traditional mortgage. Lenders will calculate the amount they’re willing to front you by looking at your money reserves, your credit, your expertise, and the purchase price of the unit you’re going to rehabilitate. They also take into consideration the estimated costs of renovating and repairing the property and the estimated value of the finished project.

Know The Loan Term:
You are recommended to keep in mind that the term for fix and flip loan is usually between 6 to 18 months. While some companies will sometimes allow for three-month extensions. Creating a budget and a schedule can make rehabbing easier, so you should have a realistic plan in place for completing the rehabilitation and selling the property before your time is up. If you don’t give yourself enough time, you could be in trouble.

The Bottom Line:
Fixing and flipping houses is definitely a great way to earn money. To succeed in this business, however, you have to be patient and dedicated to your job. If you want to get into the home flipping business but don’t have the cash on hand, a fix and flip loan may be what you need. However, your chances of securing the financing will be improved if you follow the tips above.

Manga Capital Group, Inc is a leading residential and commercial lending company in California with 30+ years of experience in the real estate industry. We provide unmatched expertise in customizing a fix and flip loan structure to meet your requirements with minimal documentation. If you are considering for a fix and flip loan, call us today at (310) 734 4044 or email info@magnaloans.com or visit www.magnaloans.com

Top 5 Common Mistakes That First-Time Home Buyers Make

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Category : Buying & Selling Tips

Are you gearing up to buy your first home? This can be an exciting and challenging experience for you. Before you can unlock the door to home ownership, you have to take some important first steps to avoid most costly mistakes that first-time home buyers make. Renting a place is much different than buying a home, you have less responsibility and worries while renting a property but when you purchase a home, many things come into factor. For most people it may seem easy, they find a house that they can afford but unfortunately, many of those people make common mistakes that hurt them in the long run. These common mistakes are easily avoidable if you’re willing to put a little time into your home search. Arm yourself with some of the common tips that most first time home buyers make when purchasing a home.

1. Not Knowing What You Can Afford

It’s one of the first most important things to know that how much can you afford for a mortgage. If you are a first time home buyer, you’re strongly advised to track your current monthly expenses making sure to include everything e.g. vehicle costs, student loan payments, credit card payments, groceries, health insurance, retirement savings and so on. Also, don’t forget to include major expenses that only occur once a year, like any insurance premiums you pay annually or annual vacations. Subtract this total from your take-home pay (actual income) and you’ll know how much you can spend on your new home each month. This first step will decide that you can or cannot afford the type or size of home you desire, also you need to work on reducing your monthly expenses and/or increasing your income before you even start looking.

2. Skipping Mortgage Loan Qualification

Skipping mortgage loan qualification is another big mistake that first time home buyers make. There are many sellers out there who will not consider your offer unless you have a letter from a financial institution stating you have been pre-approved for a loan which means you could find the house of your dreams only to lose it for lack of one piece of paper. So if you have poor credit or unstable income, start applying for a home loan before you even start looking for a house. This not only ensures you’re able to get a loan but also lets you know how much you have to spend to get the home you want. It may be more or less than you expect.

3. Forgetting About the Hidden Costs of Homebuying

Once you’re a homeowner, you’ll have additional expenses on top of your monthly payment. Unlike renting, you’ll be now responsible for paying property taxes, home insurance and making any repairs the house needs. There are a lot of fees involved and those fees can add up pretty quickly. Here are some of the fees you may have to cover on buying a home:

  • Appraisal fee
  • Credit report fee
  • Property taxes
  • Homeowners insurance fees
  • Notary fee
  • Loan application fee
  • Escrow fee
  • Inspection fee
  • Moving costs

Although, there are credits you can get to cover some of these fees and you will not all of these fees will apply depending on the lender you work with, the agreement you work out with the homeowner or the state you live in. Magna Capital Group, Inc. provides hassle-free mortgage loan on attractive interest rate with less additional fees. Call us today at (310) 734 4044 about what fees you may be responsible for and make sure you budget accordingly.

4. Skipping The Home Inspection

A home inspection is an important part of buying a home. So before going into escrow and close the deal, you have to know what kind of shape the house is in. Just like buying a used car, you must give it a thorough inspection in order to know the car is fully functioning.

You are highly recommended to make sure you get someone in your house to look it over that knows what they’re doing before you close on the house. If there are any major repairs, you may be able to get the homeowner to cover them or knock the estimate for the repairs off your purchase price.

5. Not Getting Professional Help

Buying an open house without a qualifies real estate agent is one of the worst mistakes you can make. So if you are seriously shopping for a home, don’t forget to get help from real estate professionals. Real Estate Agents are held responsible for acting on both the seller and buyers best interest. It might not work if you start dealing with seller’s agent, so we suggest you use your own real estate agent so that you can build a long lasting mutual relationship.

The Bottom Line

Buying a first home can seem stressful and overwhelming, and it isn’t without its share of potential pitfalls. If you’re aware of those issues ahead of time, you can protect yourself from costly mistakes and shop with confidence. For many people, a home is the biggest purchase they will ever make, but it need not be the most difficult.

Magna Capital Group, Inc. provides tremendous supports to make your real estate purchase easy. Our staff of mortgage professionals are committed to 100% customer satisfaction. We have extensive experience in placing conventional & private money financing on residential and commercial properties of all types throughout California. For more details or first time home buying tips, contact us today at (310) 734 4044 or email info@magnaloans.com or visit our website www.magnaloans.com

Hard Money Loans – The Quicker Way Of Financing Real Estate Deals!

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Category : Construction Loans , Fix & Flip Loans , Hard Money Loans , Real Estate Loans

Real estate investors choose to use hard money for many different reasons, but the main reason is the ability of the hard money lender to fund the loan quickly. In many cases, hard money loans can be funded within a week. The application process for a hard money loan generally takes a day or two and in some cases, a loan can be approved the same day. Quick funding is a significant advantage for real estate investors, specially when they are trying to acquire a property with many competing bids, a quick close with a hard money loan will get a seller’s attention and set their offer apart from the rest of the buyers offering slow conventional financing. On the other hand banks require lots of documents for conventional loans including credit score, income history and also there should be no issues such as a short sale or foreclosure with borrowers.

Here are some situations in which you can utilize hard money loans:

A borrower can get a hard money loan on almost any type of property – including single-family residential, multi-family residential, commercial, land, and industrial. Hard money lenders are primarily concerned with the property’s value rather than the borrower’s credit. Borrowers who cannot get conventional financing due to a recent foreclosure or short sale can still obtain a hard money loan if they have sufficient equity in the property that is being used as collateral.

Conclusion
You can consider a hard money loan to fund one of your future real estate deals as it works quickly and required less documentations rather than banks.

Manga Capital Group, Inc is a leading hard money lender in Los Angeles, California with 30+ years of experience lending on properties. For more information on our loan programs Call (310) 734-4044 or Email info@magnaloans.com

 

 

 

Get Hard Money Construction Loan To Build Your Own Home

Category : Construction Loans

Building your own home, planning its architecture and designing its interiors is a long and expensive process, but further, it’s a unique and fulfilling experience of life for everyone. After all, having a home in which you have engraved a part of yourself can bring a lot of joy personal sense of accomplishment. To achieve these all, you need a solid plan to build that work out the room you’ve always wanted or maybe that special little home office can be fulfilling and motivational. It’s difficult to convince a lender to loan you money for something that hasn’t been built yet, but there is a way to help you called “Hard Money Construction loan”.

What is Hard Money Construction Loan?

A hard money construction loan is typically a short-term loan (usually around a year) that’s supposed to cover the expenses of building a home. To get hard money construction loan, you’ll need a detailed construction plan along with a realistic budget while assuring the loaner that the project is a small risk. Usually, experienced constructors keep a sort of “blue book” that contains all the details of the project to acquire construction loan. It’s no secret that down payment plays a major factor in any loan. You can expect up to 20% to be added as down payment in the case of construction loans. The main reason why it is so, construction loans are viewed as high-risk investments in which the loaners want to make sure you see your project through.

Qualifying for a Hard Money Construction Loan

Lenders are often imposing strict qualifying requirements for a construction loan because they are lending money for something that is to be constructed, with the assumption that it will have a certain value when it is finished. If the builder does a poor job or if property values fall, then it could turn out a bad investment for lenders. They include the following provisions to protect themselves from this problematic outcome:

1. A Qualified Builder Must Be Involved. It’s important to find out a well-established building contractor with a good reputation for you. The reason for this is that going at it alone and planning to be in charge of everything can be viewed as a problem by the lenders because you have no experience of construction projects. If you can somehow present a detailed and convincing construction plan which demonstrates your skills and knowledge in the home-building business, then you might just get the loan.

2. Detailed Specifications For Your Project. The lenders need detailed specifications of your project including floor plans, as well as details about the materials that are going to be used in the home. Builders often put together a comprehensive list of all details (sometimes called the “blue book”); details generally include everything from ceiling heights to the type of home insulation to be used.

3. The Home Value Must Be Estimated by an Appraiser. The lender must have an appraiser to consider the blue book and specifications of the home, as well as the value of the land that the home is being built on. These calculations are then compared to other similar houses with similar locations, similar features, and similar size. These other houses are called “comps,” and an appraised value is determined based on the comps.

4. Down Payment. You will need to put minimum 20% down payment to obtain the construction loan. This ensures that you are invested in the project and won’t just walk away if things go wrong. This also protects the lender in case the house doesn’t turn out to be worth as much as they expected.

Conclusion

Building own home is an extremely gratifying experience, but if you are thinking of going through a home construction project, you’re suggested to be prepared a well-built project plan and get a well known qualified home builder first. Also, your budget will decide the fate of your project, so start saving up so you can cover the down payment.

Hard money construction loan is the right choice for you to build your dream home. Magna Capital Group, Inc provides hassle-free construction loan on attractive interest rates that make your affordable and easier on your pocket. We also provide customized repayment options to suit your needs. There is no hidden charges at Magna Capital Group, Inc.

You can apply online for hard money construction loan or call (310) 734-4044 or email at info@magnaloans.com.

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    8730 Wilshire Blvd., Suite 410
    Beverly Hills, CA 90211

    Although Magna Enterprises, LLC and Magna Capital Group, Inc. are referred to throughout the text of this website as Magna Group of companies, they are not affiliates, parent or subsidiary companies as both companies are separate and distinct entities. Any questions or issues regarding this disclaimer should be addressed in writing c/o Shawn Molem.

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