Real Estate Investment Loans: A Must For Real Estate Deals
Thinking of making an investment in real estate? If you are, congratulations are in order because you’re about to open up a door to lots of money-making opportunities. But hold your horses, partner. Don’t take out your credit card or think of qualifying for a bank loan and using your house as collateral because professional real estate investors don’t do it like that.
You’re probably scratching your head, thinking how you are going to make an investment if you’re not going to spend your money. Well, don’t be confused because you are simply going to use other people’s money to make an investment in real estate. You’re going to obtain so you can protect your personal assets in case something goes wrong with a deal.
If you think real estate investors use their own money when making real estate investments, you’re sadly mistaken. These entrepreneurs are aware of the certain risks that come with their business, which is why many of them recommend using real estate investment loans when investing in properties.
One of the real estate investments loans that real estate entrepreneurs are using to fund projects is private money. As the name implies, private money lending is a type of financing offered by private individuals rather than institutionalized lenders such as banks and mortgage companies. Private money lenders seek to make use of their idle money by funding real estate deals.
Another type of is called hard money loans. Like private money, hard money loans are offered by private individuals or small lending companies. They are mainly asset-based and lenders base their decision to approve or reject a loan on the after repair value of the property, for which the loan is being made.
What’s great about these types of non-traditional financing is that a real estate investor can secure funding for his investments even if he lacks creditworthiness. As long as he can assure both private money and hard money lenders that the property he wants to borrow money for can attract a good deal, then he will be able to get his money.
Be warned, however, that come with high interest rates and other fees. Because non-traditional lenders are willing to finance risky deals with their own money, they want to ensure that they will gain something even if a real estate deal fails to push through.
If you want to learn what’s the best method of financing for your real estate investments, visit www.REIWired.com.
REI Wired is the ultimate real estate investor network on the planet. The sole purpose of this site is to arm you with the cutting-edge real estate investing tactics being used by the hottest investors in the industry…so you can dominate your competition and close more deals… FAST.
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