Purchase Rehab Loans

Today’s real estate investors have found purchase rehab loans the answer to their investing needs. Purchase rehab loans are a combination loan. Part one is used to purchase the investment property, and part two is used to advance monies for needed repairs.

Many times, real estate investors need funds after closing to updated the kitchen and baths. Other times the property is just to small, and would be better used as a rental or flip if there were a more bedrooms, additional closets or storage added.

Our response to the market place in the greater Los Angeles area, we have our Purchase Rehab Loans program. You can purchase an investment PLUS add the cost of improvements to the loan! What could be better?

Here is how it works, after you find an investment property to purchase. you figure out how much work the property needs, you submit this construction schedule and estimate with your loan request.

Write an offer contingent upon the Buyer obtaining plans and specs for home improvements within ‘x’ days of approval.

On the day of closing, the seller gets their agreed to sales price and the additional funds are put in a construction account for the investor to complete improvements. Draws are made as the work progresses.

An appraisal is completed based on the ‘subject to’ completion of the work, so that you know the true value. Remember, some improvements will only bring a home up to standard value, not increase the value.

A contingency factor of 10% is allowed in the construction costs and put into the transaction. This can either be paid by you at closing or rolled into the construction portion of the loan.

The loan is an Interest Only payment at the closing of the loan and during the construction phase of the project.

Once the work is completed, the purchase / rehab loan is refinanced or modified to the final end loan. This could be a 30 Yr Fixed rate loan, a 15 Yr Fixed rate loan.

Hard Money Business Loans

Private lending groups in Los Angeles offers hard money business loans if you already have worn out all your possible financing sources from banks and traditional lenders and you still need more money to operate or expand. Since they are usually short term and must be paid within one or two years, they are also called bridge loans.

Before you sign for any hard money business loans,

When you have a growing business and want to expand it, then hard money loans can help you. Consider the following items.

1. Can you generate a return on investment (ROI)?
2. Do you have an exit strategy? Hard money business loans will be pain within a shorter period of time. Therefore, if you do not have a regular cash flow then it is not suitable for you.
3. What are your alternatives? When your alternative financing options are equity based, a hard money loan can enable you to take control of your business
4. What’s the impact on personal liability? Hard money loans are better compared to other financing sources with high costs.
5. Can you generate enough capital? A hard money loan is not the suitable option when it can’t cater your financing needs.

Hard Money Business Loans can be the very beneficial because they are easy to qualify for, close quickly and will help you to meet your business financial goals.

To apply for hard money business loans, click here

Financing foreclosures

Financing foreclosures can be a challenge. Financing real estate foreclosures with purchase money mortgages is not a viable option if the borrower or the property does not qualify.

Banks will not finance properties that need major repairs, unless the loan is owner occupied and the borrower qualifies for and FHA 203k rehab purchase loan.

Investors basically have two options when purchasing major rehab foreclosed properties. Pay cash or use hard money loans.

At first it might seem that a purchase money mortgage was the same as any other financing but that’s not entirely true. For instance, in California a homeowner with a purchase money mortgage who is foreclosed cannot be sued by the lender to make up any losses on the loan. However, if the property has been refinanced there’s no longer a purchase money mortgage and so the protection for homeowners against deficiency judgments disappears. Notice that in our example the purchase money protection does not apply to investors and that the rules in other states are different.

Foreclosure Loans

Is the buyer an owner-occupant or an investor? If an investor you may be required to put down more and to pay a somewhat higher rate. When financing foreclosures, the rules and paperwork to finance are simply the same as any mortgage originated.

Cash is king of course, solves all financing foreclosures problems while loans from hard money lenders helps many investors that can not receive bank loans.

Loans for back taxes

Loans for back taxes are common in this challenging economy markets and business changes, unfortunately many businesses miss the warning signs and over or under react to the changing industry dynamics. Their actions or inaction’s can lead to dire consequences for a small to mid size business including cash flow issues which inevitably have a trickle down effect on all areas of the company including loans for back taxes.

These cash flow issues typically lead to issues with various taxing authorities including not fully paying income taxes, property taxes, etc. To help these business owners right-size their current situation, many options are available including Accounts receivable factoring, inventory financing, equipment financing, real estate financing and loans for back taxes

Real Estate

Loans for back taxes

Real estate loans for back taxes can be an excellent alternative to higher priced factoring solutions (inventory, equipment, accounts receivable, etc…). In many cases the borrowers have an excellent piece of real estate collateral that can possibly be financed to provide ample working capital for their business. Loans for back taxes increase working capital that is one of the key variables in the turnaround of any company.

Many times these clients will not qualify for traditional bank financing. Traditional lenders focus heavily on the business financial’s (both present and historical) to evaluate the soundness of the loan. Luckily, lenders exist that focus on the borrowers collateral as opposed to their current financial’s. A perfect fit for situations like this is a private lender with a no-doc program.

Loans for back taxes are a unique niche that is very different than other sub-prime products. Typically sub-prime lenders underwrite primarily on credit, income, or cash flow of the property. The private lender no-doc loan solely underwrites the property and not the borrower or the financial situation of the company.

For example, a no-doc lender recently made a loan to a business that had lost money for the last three years. The lender was able to analyze the property, understand the company’s financial situation and the steps being taken to improve the cash flow. As long as the property has enough equity in it and a plan for success, the no-doc lender is typically able to make the loan.

A no-doc loan is typically faster, and enables the company to pull out more capital than factoring on receivables and materials. Start to finish a no-doc programs takes 2-3 weeks and can provide the borrower up to 60% of the equity in their property. The loans can typically be structured to fit the particular needs of the situation.

We can help the following borrowers:

• Unpaid property taxes
• Payroll tax issue
• Unfilled tax returns
• Business cash flow issues
• In need of working capital
• Foreclosures
• Tax liens
• Judgments
• Credit Challenges
• Mortgage lates
• Debt Consolidation
• Various other situations where time is of the essence

To apply for a loans for back taxes click here.

How long does it take to close a hard money loan?

It normally takes less then 2 weeks to close a hard money loan.