Texas Hard Money Lender

Thursday, September 5, 2019

How Do Arizona Hard Money Lenders Determine Points and Rates?

Points and rates in the hard money world can seem arbitrary and mysterious. Let's demystify them and look at how Arizona Hard Money Lenders determine them.

Interest rates, while mysterious in their own way, are at least somewhat understandable for the layperson, but points can be a little more confusing, so let's break down what they are before we get started. Simply put, points are a percentage of the amount being borrowed that the lender charges to close on the loan. For instance, 2 points on a $100,000 hard money loan would be $2,000. Just like the interest rates, the points you'll be charged are based on one overarching factor — risk.

Let's take a look at risk and some of the factors that lenders use to determine risk. Namely, exit strategy, experience, and equity.

How Hard Money Lenders Determine Risk

The experience of the borrower. If you are borrowing to do a fix and flip, a spec home or any new construction, the lender will take a look at how much experience you have. If this is your first time trying your hand at it, the lender might see that as a bigger risk than someone who's successfully flipped 10 homes in the same area.
The equity of the property. This is especially important if the property is being put up as collateral to secure the loan. If you come to the Arizona Hard Money Lender with solid, verifiable figures on the property's worth and, more importantly, its future worth, you might be able to negotiate lower points and rates.
Your exit strategy. This might be the most important factor. Arizona Hard Money Loans are like mortgages; they're meant to be quick and have a specific end date. Luckily, you're both pushing in the same direction on this one. Both you and the lender want to be able to sell the spec home or flip for a profit within a set period of time. Come to the table with a realistic plan for finishing the project and selling within a reasonable time frame and your rates might reflect that.

Amazing Rates from Arizona Hard Money Lenders

Equipped with this knowledge, you can come to your Arizona Hard Money Lender well-prepared. Here at Level 4 Funding, we have loans with fixed rates of 5.99% and some loans with absolutely no points, plus flexible terms from 3 to 60 months. Ready to see the great rates you can get on a hard money loan? Contact us today to find out!

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC
Hard Money Lender
Hard Money Loans
Hard Money Loan
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis@level4funding.com
Dennis Dahlberg Broker/RI/CEO

NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave | Austin | Texas | 78701
About: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 43 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.
© 2019 Level 4 Funding LLC. All Rights Reserved.

Get in on the Builder's Market with Spec Home Financing

Demand is outpacing supply here in Arizona now, so it's a good time to be a builder. Here's how to be a part of the action with Arizona spec home financing.

While building a spec home might seem like a risky proposition (and it can be depending on a lot of factors), there are actually a number of advantages to it. This is especially true in a market like the one we have here in Arizona where there's more demand for new housing than there is supply.

● There's much less competition. Everyone and their mother are getting into flipping, wholesaling and rehabbing, but spec home building is a much more specialized endeavor, which means less people out there doing it.

● You get to start with a clean slate. When you buy a property, you have it inspected, but there are all sorts of things that can go wrong. These little surprises have sunk many a flipper. With a spec home, you get to control the materials and oversee the construction, so those mini shockers are fewer and farther between.

Things to Know Before Getting Spec Home Financing

Before you come to a private money lender to build a spec home, there are a few things you should have in your back pocket. These are:

● Know your market backward and forward. Know the absorption rate for current homes. Know the employment factors. Know average sale prices. Know trends in the market. Know the average days on the market. Do your research and understand all the factors involved.

● Come with a budget. As we all know, projects can get delayed and budgets can blow up, but it's important to crunch the numbers ahead of time and be as realistic as possible.

● Find the best deal on the lot. Much of your profit will come from the purchase of the lot, so finding a fantastic deal will increase your margin for success. And isn't that what we're all trying to do?

Spec Home Financing in Arizona

Finding Arizona spec home financing through the bank can be a challenge, especially if you don't have a perfect financial situation. Private money lenders, like Level 4 Funding, can be much more flexible with approvals, terms and rates. So if you're ready to build your spec home in Arizona and need Arizona spec home financing, give us a call today to talk about your options.

Here's How to Get in on the Booming Cannabis Industry

The cannabis industry is booming. Here's how to use cannabis loans get in on the action and build wealth in it.

It might be the understatement of the century, but we'll say it anyway — the CBD and legal marijuana industry is blowing up. In fact, numbers suggest that legal marijuana had an economic impact of $20 to $23 billion in 2017. That number is expected to grow to $77 billion by 2022. That tops the total sales of organic produce, Oreos, video games and doughnuts.

Perhaps even more exciting are the numbers for CBD, a product that doesn't face the same legal gray areas that marijuana does (though 77% of Americans now support legalization). CBD products brought in $591 million in 2018 according to the Brightfield Group. Studies predict that that number should grow to $22 billion in just four years by 2022. The represents an astronomical compound growth of 147%.

So, we can all agree. It's a business that's going to take off in the coming years. But how can you use that to build wealth, especially if you're someone without a ton of capital or a less-than-stellar credit score? Here's how.

Hard Money Cannabis Loans Might Be the Answer

Hard money cannabis loans, like most private loans, are based on collateral, not your credit score or past financial history. That means the dream of getting rich in the legal marijuana and CBD industry is within reach for anyone. There are several advantages to going this route instead of the banks:

● You have a much better chance of getting approved

● When you're approved, you can get your funding faster; sometimes in a matter of a week

● There's no begging, no jumping through hoops and no stress

● You won't be slammed with tons of upfront and junk fees

Call Today for a Hard Money Cannabis Loan in Arizona

Here at Level 4 Funding, we have extensive experience in the cannabis industry, having been involved since the very beginning. Our loans are flexible and designed to work for you. Interest rates for cannabis loans start at just 7.99%. So, what are you waiting for? Speaking with us on the phone, chatting with us online or using our free quick loan application on our site doesn't cost you a thing. Contact us today and see how we can help!

How to Get a Rehab Loan Even With Rotten Credit

Got a dream of rehabbing a home? Learn how to get a Arizona Rehab Loan even when you've got subpar credit.

In this country, a low credit score can seem like handcuffs, preventing you from doing even the most basic things in life. Renting an apartment can feel like an uphill battle. Starting a business can feel like a pipe dream. Buying a home can feel unrealistic and investing in real estate can feel next to impossible.

It doesn't have to be that way. Most people think that investing in real estate means going to a bank, sitting down with a representative, going through a long application process and having every detail of your financial life sifted through by a huge corporation.

Here's the good news — hard money Arizona Rehab Loans offer a great alternative to bank loans for people who don't have a great credit score or a spotless financial history.

Hard Money Rehab Loan Terms, Qualifications and Rates

So if you can get a hard money loan without a good credit score, the terms must be terrible, right? Not so much. Our loans have terms of anywhere from 3 months to 60 months, allowing for a wide range of fix and flip projects. Interest rates start at just 5.99% and we have loans that can cover up to 90% of the cost of the property and up to 100% of the rehab costs involved in fixing and flipping.

What does that mean for you? It means that even if your bank account is low and your credit score isn't perfect, you can put a plan in place, roll up your sleeves and do the hard work it takes to make money in real estate. This country was built on the idea of giving hard-working people a chance to build something, regardless of their past or their current standing. Arizona Hard Money Loans allow that idea to flourish in a climate where big banks dominate the industry.

Getting a Rehab Loan in Arizona

Looking for a Arizona Rehab Loan in the Copper State but don't have a stellar credit score? Finding a loan may be easier than you think. Here's the best part: speaking with us here at Level 4 Funding doesn't cost a thing. We have a fantastic track record of helping people get the funding they need to realize their dreams of rehabbing and flipping properties.

Can Fees Be Rolled into a Loan from a Arizona private money lender?

Arizona private money lenders generally charge less fees than banks, but they aren't nonexistent. So what do you do if you can't pay them? Let's take a look.

Beth wants to try her hand at flipping a property. She's crunched the numbers 10 times, researched properties in the area, looked at potential growth and has a rudimentary budget in place. She's even watched every flipping show on television. Unfortunately, her recent divorce means her finances aren't as healthy as they once were. She decides to go to a Arizona private money lender to better understand her options.

The house Beth has her eye on is $100,000, and that includes closing costs like title insurance, transfer tax and closing fees. Sadly, there are other fees that aren't part of the closing costs and have to be paid upfront.

On top of these typical fees, she's also got a bird dog fee of $800. A bird dog fee goes to a "bird dog" — a person who finds motivated sellers or properties that are undervalued. In addition, there's an insurance bill for $650 and a Self-Directed IRA fee of $300. The lender bears no responsibility for these fees; they're all up to the borrower to pay to get the deal to go through.

That's the end of the fees, but Beth also wants to rehab this delipidated property, which is going to take at least $20,000.

Private Money Loan Structure

Here's the good news: Beth can borrow the money for the fees and the rehab. By rolling those fees and rehab costs into the loan, she'll borrow a total of $121,750. She can borrow the $101,750 at once to close the deal and then take "draws" throughout the rehab. Draws are given out a little bit at a time as the rehab goes on. Beth will need to show that repairs are needed and offer budgets and, ultimately, proof that they were completed.

When the project is completed, Beth sells the property for $150,000, making nearly $30,000 without spending much at all.

Picking the Right Private Money Lender is Important

While private money is simpler than bank loans, they still come with their own set of complications. That's why it's important to have a Arizona private money lender who can explain everything to you, from the requisite fees to the ins and outs of repayment. Being armed with this information will make the process much smoother.

How to Jumpstart Your Company with a Arizona Business Loan

Whether you need a launch a company or complete an important project to grow your company, a hard money Arizona Business Loan might be a good option for you. Here's a rundown of how it works.

If you're a business owner, you know it all too well — running a company is hard work. You put your blood, your sweat, your tears, and even your soul into your business. Its fortunes are often tied to yours; if it succeeds, you succeed and if it fails, it can send your life into a tailspin. Making your business a success means both starting it on solid footing and being able to adapt to change.

What do both of those things take? Money. If you've been turned down for a traditional loan for your company by the bank, it might feel like you have to put your dreams on hold. Like you'll never get your business off the ground or you'll lose the business you have.

Luckily, the banks aren't the only place to get a loan. Hard money Arizona Business Loans may also be an option for you.

How a Hard Money Business Loan Can Help

Arizona Hard Money Loans are an alternative to bank loans. Banks might dissect every aspect of your company's finances, your financial history and even your life to decide whether you're worthy of a loan, but Arizona Hard Money Loans work differently. They're secured with collateral (for instance, a home or other property), meaning you don't have to jump through hoops to try to get approved.

To get one, you'll want to understand your loan-to-value ratio. Here's an example. Let's say Jane Doe Clothing has an expansion project that's projected to cost $200,000 dollars and they need to borrow at least $150,000 to fund it. $150,000 is 75% of $200,000, so they would have a loan-to-value ratio (LTV) of 75. When they approach a hard money lender, that figure will play a role in approval and the rates and terms they'll get.

Hard money Arizona Business Loans are also faster than traditional loans, but they can also come with higher interest rates and strict repayment guidelines.

Business Loans in Arizona

Level 4 Funding is your source for business funding in the state of Arizona. We've got decades of experience helping business owners get the loans they need to succeed. Give us a call or send us an email today to see how we can help.