What is hard money loans? Real estate offers portfolio diversity, and with careful planning and following a strategy, investors can build great wealth and financial freedom. Diversity can protect you from economic downturns in any one sector of the market, and real estate allows investors to live out their golden years on their terms, doing what they enjoy. In addition, passive income in retirement earned through real estate investments offers a hedge against the ravages of inflation because rental rates tend to keep pace with increases in the cost of living. Hard money loans or bridge loans allow investors a quick and flexible solution to hold onto their cash while building their holdings using cash from someone else, a private money lender. This short-term financing option is typically to rehabilitate or develop a property and then sell or flip the property. Read on as we explore what Northern Kentucky real estate investors need to know about hard money loans.
The Cons
As with most things in life, you should consider both sides of what Northern Kentucky real estate investors need to know about hard money loans, including the drawbacks, though they are few. Hard money loans also come with a higher interest rate and have higher costs in general for processing. Additionally, they are for a shorter term than conventional loans, from between one to three years. If you don’t have around 25 to 30% to put down, they may also seek an interest in the property. With high payments due to the interest and short duration of the loan, an income stream from a sound investment helps repay the loan and save money. Make sure you fully understand the agreement and have performed due diligence on the investment property. The asset, or the property, is the security for the loan, meaning it is at risk should you default on the loan.
Conventional Loan Denied
For those who cannot pursue a conventional loan because of the risk of the investment or their credit status, Northern Kentucky real estate investors need to know about hard money loans, which offer flexibility because of their looser restrictions and the differing requirements for loans than conventional lenders.
Quick Process
Another thing that Northern Kentucky real estate investors need to know about hard money loans is a quick application and approval process. They make a great option to keep your investment business rolling with fast and convenient access to cash.
We Buy NKY Houses Has The Experience You Need To Help You Sell Your House
Something else Northern Kentucky real estate investors should keep in mind about hard money loans Northern Kentucky is that you can improve your standing by working with the same hard money lender repeatedly your interest rates can go down. As you gain experience, prooving your ability to make successful investments, you become less of a risk.
Working with We Buy NKY Houses makes selling easy from start to finish. The professional buyers at We Buy NKY Houses understand that it can be very stressful when you’re trying to sell your Northern Kentucky house in a hot market. If you prefer to skip all of the headaches of listing, forget all about making repairs and renovations, or if you have no interest in living in a home while renovations and repairs are happening, We Buy NKY Houses is your answer.
An investor has none of these expenses! And because investors pay cash and buy your house as-is in most cases, you can close fast, sometimes in a matter of days!
If you have questions like: What are typical terms for hard money loans? How does interest work for hard money? Then give us a call Then give us a call. Our Real estate experts will be able to answer any questions you have, can make recommendations and may be able to provide you an offer over the phone!