How To Use Hard Money Loans to Make $100,000 A Year In Real Estate

You can get a loan to buy real estate from a hard money lender even if you have bad credit and no job.

(PRWEB) October 11, 2005 -- Real estate investors nationwide have a little secret! They have been able to grow their business by leaps and bounds because they don’t need a vault full of money and they can avoid the hassles and constraints of borrowing money from banks.

The secret is a Hard Money Loan!

A hard money loan is not through a bank. It’s usually through an individual called a private lender or a small company who is in the business of loaning out money to investors.

A hard money loan is based on the equity in the property. You can get a hard money loan even if you have bad credit because the lender is protected by the equity in the property. Most hard money lenders will loan up to 65% of the after repaired value. This makes the loan safe for you and safe for the lender.

Unlike a bank loan, a hard money lender does not care how bad the house looks. For example, many banks will not lend on a house with no kitchen, foundation problems or a hole in the roof. But a hard money lender will.

Why will they lend on a dilapidated house?

They realize these houses can easily be fixed to bring the property back to it’s full retail value so it can be sold for a tremendous profit.

A hard money loan can usually close in just a few weeks which means you can buy houses faster. Another advantage, there’s minimal paperwork and documentation necessary to get a loan.

If you buy the house right, you can get a hard money loan for the full purchase price and the rehab costs – which means you don’t need credit to get a hard money loan, but you also don’t need any money. A hard money lender will provide up to 100% of the purchase and rehab funds for a project if the total price of the house plus repairs is less than 65% of the after repaired value. No bank will lend with these kind of terms.

These are special loans and only available through a few sources. They are short term loans – typically for 6 – 12 months only. Yes, you pay a little more for the use of these type of loans, but it’s not the cost of the money that’s important, it’s the availability of it. By using hard money loans, you’ll be able to make tens of thousands of dollars on foreclosure and other run down properties you would not otherwise be able to purchase

Hard money loans are calculated with simple interest which means you only pay for the use of the money while you are using it. If you use the money 3 months, then you only pay interest for 3 months.    If you’re worried about making payments on the house while you are rehabbing it, there are even programs available so you don’t have to make any payments until you sell the house.

Unlike traditional mortgage companies or banks, hard money lenders in the business of lending to buy run down properties or foreclosures.    

Hard money rates are 13.88% and 4 points for loans at 65% of market value.    Here’s how a typical deal might work:

You borrow $60,000 at 13.88% and 4 points. The loan is repaid within 5 months. What did it cost to use $60,000 for 5 months?    

$60,000 @ 13.88% per month = $694 x 5 = $3470
plus 4 points             = $2400
Cost of money                = $5870
        

    You are able to sell the house for $130,000.

How many times would you like to pay $5,870 to make $55,000?

That’s what hard money loans are all about! Remember, it’s not the price of the money you borrow but the availability of it.

The availability of hard money loans has made it possible for real estate investors to grow their business and make fortunes along the way.

To learn more about our hard money loan programs, go to www.FixerFunding.com

Contact:
Jackie Lange, Manager
www.FixerFunding.com
1802 Pleasant Valley Rd.
Suite 100163
Garland, Texas 75040
972-496-6032 phone

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