Author Archives: Shawn Molem

Tips to qualify for a Construction Loan

Category : Construction Loans , Home Loan

Banks and mortgage lenders are often leery of construction loans for many reasons. One major issue is that you need to place a lot of trust in the builder. The bank or lender is lending money for something that is to be constructed, with the assumption that it will have a certain value when it is finished.

 

  1. A Qualified Builder Must Be Involved. A qualified builder is a licensed general contractor with an established reputation for building quality homes. This means that you may have an especially hard time finding an institution to finance your project if you are intending to act as your own general contractor, or if you are involved in an owner/builder situation.
  2. The Lender Needs Detailed Specifications. This includes 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. Although it can seem difficult to appraise something that doesn’t exist, the lender must have an appraiser consider the blue book and specs of the house, 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. You Will Need to Put Down a Large Down Payment. Typically, 20% is the minimum you need to put down for a construction loan – some lenders require as much as 25% down. This ensures that you are invested in the project and won’t just walk away if things go wrong. This also protects the bank or lender in case the house doesn’t turn out to be worth as much as they expected.

 

10 Must-Knows About Hard Money Loans

Category : Hard Money Loans

Hard money loans made by private investors are one of the best sources of financing for investors
looking to take advantage of the great prices in California’s residential housing market. With attractive
terms and rates on one to four unit homes, they make it possible for you to purchase great
opportunities even in today’s constrained lending market. Here are 10 things that you should know
about these exciting financing products:
1. Hard money loans make tough transactions possible. When you have a slam-dunk transaction that
will not pass muster with a bank, they are your best option.
2. They are less expensive than you think. While hard money typically costs more than a bank loan,
most borrowers can get loans at very favourable rates and terms. Given the returns that most real
estate investors expect to make from properties bought with hard money, the loan is quite
inexpensive.
3. Cash reserves matter. Most private lenders want to ensure that you have enough money to service
their loan, no matter what.
4. Private loans can be used for construction and rehab financing as well as for straight purchases.
5. Hard money loans are fast. You can expect your loan to close in days or weeks instead of months.
While loans usually take two to three weeks to close, three day closes are possible.
6. Hard money lenders are flexible. Since they are private individuals, they can frequently structure
loans creatively to meet your specific needs.
7. Flips, rehabs and other distressed property transactions are not a problem. If they will make you
money as an investor, they are a perfect opportunity for a private lender.
8. Access to private mortgage loans makes it easier for you to get the best deals. Being able to buy
with no loan contingency or with a very short loan contingency makes you a much more attractive
buyer to the sellers of distressed property with a great deal of upside.
9. Hard money loans are available with a longer amortization period or, in the case of short term
loans, on an interest only basis. This frees up more cash flow for you to use to make other
investments.
10. Private mortgagers are usually more worried about your character than your credit score. While
you must be creditworthy, most private lenders will not immediately dismiss you on the basis of your
FICO score alone.

Top 5 Advantages Of Mortgage Refinancing

Tags :

Category : Mortgage Loans

Mortgage Refinancing is a process of replacing an existing loan with a new one in order to reduce monthly payments, lower your interest rates, take cash out of your home for large purchases, or change mortgage companies. Most people refinance when they have equity on their home, which is the difference between the amount owed to the mortgage company and the worth of the home.

There are many advantages of mortgage refinancing but one of the main advantages of refinancing regardless of equity is reducing an interest rate. A lower interest rate can have a profound effect on monthly payments, potentially saving you hundreds of dollars a year.

Here are the top 5 amazing advantages of refinancing your mortgage:

  1. The first and the most useful advantage of mortgage refinancing is lower your monthly payment.
  2. The second important advantage of mortgage refinancing is shortening the tenure period of the existing mortgage loan. For example, if the tenure period of your existing mortgage loan is 30 years and it seems to you that paying the same amount each month for as long as 30 years is not possible for you, you can transfer the tenure duration of your existing mortgage from 30 years to 15 years, or even to 10 years. This will definitely ensure your future security more prominently.
  3. Mortgage refinancing provides you a chance to shift from an FRM to ARM. If you have an adjustable rate mortgage (ARM) you could lock into a fixed rate mortgage (FRM) and gain the security of knowing what your mortgage payments will be for the life of your mortgage.
  4. Another big advantage of mortgage refinancing comes with the cash-out refinancing option. You can take advantage of some of the equity you have built up in your home over the years.
  5. You can use the equity value of your home by cash out refinancing to get rid of debts. As a large mortgage is tax deductible, unlike credit cards, it becomes an extra benefit for you. By this way, you will save money and pay off your debts simultaneously.

The Bottom Line:

Mortgage refinancing is a great financial move to reduces your mortgage payment, shortens the term of your loan or helps you build equity more quickly. Refinancing your mortgage is also helpful in getting your debt under control. If you are considering refinancing your mortgage, you are advised to look at your financial situation and the market rates carefully and then consult with your most trustful mortgage loans lender to choose the best option to avail the real advantages of mortgage refinancing.

Magna Capital Group, Inc has more than 30 years experience in the financial services business. We provide hassle-free home equity loans and mortgage refinancing with lowest interest rate and flexible terms. For more information about refinancing your mortgage, Call (310) 734 4044 or Email at info@magnaloans.com or Visit www.magnaloans.com.

What is refinancing?

Category : Mortgage Loans , private money lenders

Refinancing lets you change your home loan to suit your new circumstances. Mortgage Choice recommends an annual Home Loan Health Check to assess whether the original home loan you chose is still the most suitable option.
How does refinancing work?
When you take out a new loan, you use some or all of the funds to pay out your existing loan. The new loan often comes from a different lender, but many people refinance with the lender they’ve been using for years. If you move to a new lender, that lender will take care of paying out your existing loan.
If you are unsure whether refinancing is right for your current situation, refer to our refinancing checklist. Check out our latest Refinance Home Loan Infographics too for more details.
What type of things do people refinance for?
Home loan refinancing may be used for different reasons including:
Renovating your home or other home improvements such as a pool.
Paying off your debts such as credit cards by rolling them into your home loan.
Obtaining a cheaper rate, even if it means giving up a few loan features.
To raise cash for a purchase such as a car
You are paying a high interest rate – for example, if you arranged a low-start, rising-rate loan from your home builder.
You want to switch from a variable rate to a fixed rate, perhaps because you can want to reduce the risk of higher repayments.
How will refinancing benefit me?
Refinancing can be a smart way to manage your money. Here are a few reasons why you may want to refinance:
To get a peace of mind with a fixed rate
To obtain a lower interest rate so as to reduce your monthly payments
To gain the flexibility to pay off your loan faster
To consolidate credit cards, personal loans or other debts to reduce your interest rate and monthly repayments
To unlock the equity in your current property to finance a renovation, purchase an investment property or free up some extra cash.

Why Hard Money Lenders Are Better Than Banks

Tags :

Category : Buying & Selling Tips

If you are a real estate investor and looking for funds to finance your property or you want clear and better terms in repaying your loans, then going with a hard money lender can be your best choice.

And here’s why you should:

Deals are more important than your current credit score. This means you can secure a loan from a hard money lender even if you have a bad credit score. But with banks, we cannot even think for a loan with a bad credit score. Private money lenders don’t care about your credit history. They only look for a profitable deal. And if you can present one, then you have got a deal!

Get a loan with a hard money lender in a day! Yes, it is that easy. You don’t need to get queued in long lines and talk to dozens of representatives only for your loan to be rejected in the end. Hard money lenders can provide you with the money in a matter of days. You only need to present a good deal to them. If a hard money lender thinks that the house or property has the huge potential to be sold immediately, then he will provide you with the loan.

If you propose a really good deal to your private money lender, There are chances that you don’t need to spend even a single dollar from your own pocket to complete a deal.

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    Tel: (310) 734 4044
    Fax: (310) 734 4055
    Email: info@magnaloans.com

     

     

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    Magna Capital Group, Inc
    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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