Category Archives: Hard Money Loans

10 Reasons Real Estate Investors Use Hard Money Loans!

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Category : Hard Money Loans

A hard money loan is a specific type of asset-based loan financing through which a borrower receives funds secured by real estate property. Hard money loans are fastest financing tool for real estate investors to quickly acquire the capital needed to purchase, refinance or renovate a property.

Here are 10 benefits of hard money loans for real estate investors:

1. Quick approval and funding
It’s one of the biggest advantages of using a hard money loan. The hard money loans for real estate application process is simple. Generally, hard money lenders consider the property, the borrower’s experience, the exit strategy for the property and cash reserves in order to make the monthly loan payments. As long as everything seems reasonable in these areas approval will most likely granted. In many cases the approval for the hard money loan can take place in just one day and can be funded with 3-5 days.

2. Flexible Term Structure
Traditional lenders are not as flexible and typically take a one-size-fits-all approach to all requests. They often very rigid and have very strict rules and regulations that can prevent you from getting your loan approved. Although hard money lenders also have regulations, they aren’t as strict.

3. A perfect credit score isn’t necessary
You bank will require a perfect credit score and an income history before approving your loan. If you have a poor credit score, or you don’t meet the bank’s criteria, your loan request won’t be approved. Hard money lenders don’t require all these formalities. They focus on the value of the property and down payment the borrower has invested. The hard money loans for real estate will approve if they are comfortable with the equity and valuation.

4. Hard money loans can approve even when you have issues on record
If you have issues such as bankruptcy or foreclosures on your record, traditional banks may prevent your bank from financing you. However, hard money loans for real estate lenders will focus on your equity and not past records.

5. Hard money loans help to make your offer stronger
When you make an offer with a hard money loan, your offer will appear stronger, especially if there are several interested investors with bank loans. Banks are known for pulling financing from buyers during escrow and killing the deal.

6. You can close the deal quickly at lower price with hard money loans
With hard money loans, you are able to haggle and get a lower purchasing price and a promise for a shorter escrow period and closing..

7. You can use leverage to invest more
Purchasing properties with cash has several benefits including purchasing properties at auctions. However, because paying cash can limit the number of your investments, you can use hard money loans for real estate and get up to 75% financing. You will have money to secure properties and retain more to complete your other projects.

8. Reinvest equity from your property to a new property
When an opportunity arises, you will have limited time to act. If you are raising money to make a down payment or to purchase the property, you will have few options; for instance, cash-out refinance hard money loans real estate. You can qualify for such a loan in case you have enough equity in your property.

9. More capital and financing options available with hard money loans
Most banks will only offer loans to a single borrower up to four times. However, hard money financiers don’t have such limitations. Their main concern is only your equity in the property.

10. No Prepayment Penalties with hard money loans
Banks often charge hefty prepayment penalties if circumstances change and a loan is fully or partially repaid before the due date. Private hard money lenders are fully invested in your success and typically structure loans without prepayment penalties or added fees. It’s one more way a private lender can contribute to your success.

The Bottom Line:
Hard money loans are valuable tools that investors of all types and experience levels can use to leverage the purchase and rehab of investment and commercial properties. Private lenders can fund quickly, within a flexible structure and without prepayment penalties that can unintentionally hinder the success of your business. Hard money lenders can offer benefits that many conventional and traditional lenders cannot.

If you want to know whether or not a hard money loan is a good solution for your particular investment, please feel free to contact Magna Capital Group, Inc. today at (310) 734 4044 or Email at info@magnaloans.com.

The Most Efficient Ways To Get Financing With Bad Credit!

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Category : Bad credit home loans , Hard Money Loans

Do you have bad credit but are in need of a loan right now? If so, you need to find out about loans for people with extremely bad credit and you will be surprised that you do have options. Having a bad credit could make your life difficult in the past. But these days, things have changed. Here are a few ways to try getting a loan with bad credit:

Visit Credit Unions:
You can visit credit unions near you. A credit union is a member-owned financial co-operative. These institutions are created and operated by members and profits are shared between the owners. Credit unions may be more willing to work with you, even if you’ve got bad credit. Because they tend to be smaller than large banks, there’s a better chance that they’ll look at you personally – as opposed to just looking at a credit score and other numbers on the loan application.

Try P2P Lenders:
Peer to peer lending services is another option for getting a loan with bad credit. Instead of borrowing from banks (with rigid rules and higher overhead costs), you can borrow from individuals. They may be more sympathetic, but they’re not looking to lose their money.

Tap Friends & Family:
If your credit is really bad, your friends and family may be your only option. They know you, and they may be willing to take a chance. If you borrow from friends and family, do it properly so everybody’s protected: document the loan terms on paper, and consider using a third party to process payments. If friends and family won’t hand over their own money, they might still be able to help. If they have good credit, they can help you qualify for a loan as co-signers.

Get Bad Credit Loans:
A bad credit loan is the last resort of getting finance with bad credit. It’s most efficient and easy way to fund quickly. There are both secured and unsecured options are available for bad credit loans. Unsecured bad credit loans will require no collateral and will suit if you want to borrow smaller amounts. For larger amounts secured bad credit loans are appropriate and would require collateral like home or real estate property. Bankruptcy, arrears, late payments, CCJs, defaults, foreclosure and any court case are seen as bad credit cases. None of these things on your credit report can prevent you from having bad credit loans unless you have pretty bad credit condition like multiple bankruptcies. In worst case scenario there will fewer lender ready to take this sort of risk.

Loans for bad credit offer respite to people whose loan applications have been rejected by all other lenders, citing their poor credit history. The biggest advantage of such loans is that you can obtain the much-needed money that was otherwise not available to you. Bad credit loans can help get you back on your feet financially and have the added benefit of improving your credit score. Being regular on bad credit loans have positive effects on the borrower’s credit history.

The Bottom Line:
Bad credit loans are helpful in gaining and improving financial status and the credit score of the person. If you need cash but don’t have the funds, then consider applying for bad credit loans. These loans do not require any credit checks. The person having bad credit history like arrears, default payments, late payments etc can avail this loan facility as this facility is specially designed for these types of people.

For more information about bad credit loans, contact Magna Capital Group, Inc. today at (310) 734 4044 or email at info@magnaloans.com. We will find the right loan program with comfortable monthly payments for you.

Improve Your Credit Score With Hard Money Loans!

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Category : Bad credit home loans , Hard Money Loans

A credit score is one of the most important components within your financial realm. Your credit history determines what loans you will qualify for and the interest rate you will pay. A credit score provides an easy way for lenders to numerically judge your credit at a point in time. It gauges how likely you are to repay your loan in a timely manner. The better your history appears, the more attractive you become as a loan customer.

Most people don’t put much thought into their credit scores until the time comes to apply for a loan. Unfortunately, some people run into situations or make bad decisions that affect their credit score. Thankfully, hard money loans are great options for those people who have bad credit histories. The loan criteria of hard money loans do not focus on the credit histories of the borrowers. Hard money lenders provide borrowers with the money they need in order to complete specific tasks, they allow them to improve their FICO credit scores.

Repairing credit score is a bit like losing weight, you are required to plan your budget and avoid unnecessary expenses. You also need to increase your saving and earning as well to have a good credit score. Before finding out how to use hard money loans to repair credit scores, you must make sure that you can comply with the terms and conditions of this loan. If you are able to pay off the loan by the due date, you can definitely use it in order to improve your credit score.

The following lines show how hard money lenders can help debtors improve their credit histories.

Flexible Agreements: hard money loans come along with more flexible agreements compared to the traditional mortgage loans. This means that lenders are able to adjust the terms and conditions of a hard money loan in order to help a borrower to repay it on time and improve his or her FICO scores.

Extendable Payment Terms: Due to the current economic situation, more and more people are searching for loans that provide extendable payment terms. These loans allow lenders to extend the loan repayment term up to three years.

Debt Consolidation: Hard money lenders usually allow people to refinance existing debts. This can definitely help a debtor to improve his or her FICO score.

Conclusion:
Your credit score plays an important role in your financial journey. If you expect to need financing in the next few months and aren’t convinced your credit score is high enough to get you approved, you’ll need to act quickly to improve your chances. You are advised to check and manage your credit score regularly, as it can affect your ability to borrow money or access products such as credit cards, or loans.

A hard money loan is a big advantage for borrowers who have bad credit histories. Magna Capital Group, Inc is one of the most trusted hard money lenders in California that provides fast financing solutions for borrowers who have come across challenging times and are in need of fast, creative financing solutions without regard to their FICO credit score.

For more details about hard money loans, please feel free to call us today at (310) 734 4044 or email at info@magnaloans.com.

Finance Your Fix and Flips Projects With Hard Money Loans!

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Category : Fix & Flip Loans , Hard Money Loans

Fix and flip is really a slang term to describe a type of real estate investment deal. The real estate investors purchase an undesirable single family home at below market value and do some repairs to the property in order to make it more appealing. The idea is to significantly increase the market value of the property with the minimal expense possible so that the home can be resold for profit.

While buying, fixing and quickly reselling properties can be lucrative, it takes much more money to flip a house than it does to simply buy a house that you want to live in. Not only do you need the cash to become the property’s owner, you also need renovation funds plus money to pay for property taxes, utilities, insurance and loan interest from the day the sale closes through the rehab work and until the day it sells.

Unfortunately, many people struggle to find financing to buy fix and flips. Hard money loans are the best financing source for them. Hard money lenders provide loans to experienced or inexperienced flippers who need money quickly. Hard money lenders do not require the same amount of time and paperwork as traditional banks. Instead, they evaluate the property itself (both before and after improvements) and your ability to successfully complete the project.

Here are some important reasons that house flippers use a hard money loan instead of a bank loan. Compared to a bank, hard money lenders typically:

  • Can give you a quicker loan quote
  • Can fund a loan much faster
  • Don’t always require third party appraisals
  • Make loans on distressed homes that need rehab. Many banks won’t touch this type of property
  • Rely heavily on the value of the property. Banks typically rely heavily on the borrower’s credit
  • Have much shorter approval process, less red tape, and less paperwork
  • Don’t have maximum exposure limits to one borrower

The Bottom Line:

Hard money lenders play a vital role in the financing of all kinds of real estate investments and especially for flipping houses. A hard money loan is good for the experienced and inexperienced fix and flippers. The use of hard money in your house flipping business can be a tremendous benefit, increase your margins, help you grow your business, and allow you to diversify your risk. However, you just need to do your homework, ask questions and minimize the risks that come along with the use of outside capital.

If you are an investor who is ready to make an offer on a property and you need financing or just want to get pre-approved loans, then you have come to the right place! Magna Capital Group, Inc is one of the most trusted hard money lenders that can help you achieve your house-flipping dreams. We provide fix and flip loans across California. Our interest rates start as low as 7% and monthly payments are interest-only. Further, pre-qualification takes few minutes and funding happen in 10-15 days.

For more information about our fix and flip loans program, please feel free to call us today at (310) 734 4044 or email at info@magnaloans.com.

 

Top 5 Situations For Whom Hard Money Loans Are Ideal!

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Category : Hard Money Loans

Hard money loans are quite different from bank loans. A hard money loan is simply a short-term loan secured by real property. The terms are usually around 12 months, but the loan term can be extended to longer terms of 2-5 years. The loan requires monthly payments of only interest or interest and some principal with a balloon payment at the end of the term. Interest rates for hard money loans range from 10-15% and points can range anywhere from 2 – 4% of the total amount loaned.

The amount that hard money lenders are able to lend to the borrower is primarily based on the value of the subject property. Many hard money lenders will lend up to 65 – 75% of the current value of the property. Some lenders will lend based on the after repair value (ARV) which is the estimated value of the property after the borrower has improved the property. A borrower can get a hard money loan on almost any type of property including single-family residential, multi-family residential, commercial, land, industrial many other types of properties that fall outside of the conventional parameters likes rehab loans, construction loans, bridge loans, land loans, mixed use property, non-owner occupied rentals used to secure startup capital for new ventures.

Hard money loans are ideal for below top 5 situations:

1. Fix and Flips
2. Land Loans
3. Construction Loans
4. When the Buyer has credit issues.
5. When a real estate investor needs to act quickly

Why should use a hard money loan?

Borrowers choose to use hard money loans for many different reasons. Hard money lenders have the ability to fund the loan quickly. In most situations, hard money loans can be funded within a week. The ability to obtain fast funding is a significant advantage for a real estate investor. Especially when the real estate investor is 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.

Hard money loans are backed by the value of the property, not by the creditworthiness of the borrower. Borrowers who are rejected or cannot find conventional financing due to their low credit score, bad income history, a recent foreclosure or short sale, they can still obtain a hard money loan if they have sufficient equity in the property that is being used as collateral. The hard money lenders provide you flexible loan repayment terms. So, if times are tough you can get by with only paying interest each month or with only paying the balloon repayment at the end. This makes it easier for you in the long run instead of causing you to make a hefty payment each month.

Conclusion:

Hard money loans are the faster route to financing than bank loans. They have relaxed approval standards, are fast to get, and require less paperwork. Hard money loans may be wonderful for you when you need them in a crunch and can’t get the money from anywhere else.

You can consider a hard money loan to fund one of your future real estate deals. If you have questions or would like to receive additional information about hard money loans, please contact Magna Capital Group, Inc today at (310) 734 4044 or email at info@magnaloans.com.

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    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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