Hard Money Loans
Hard Money Loans-Easy To Borrow
Author: Steve A Clark, Category: Private Loans
Hard money loans are the amount being borrowed to solve some urgent financial problems. The term hard signifies it’s quite Herculean to obtain because these loans are not provided by banks or financial institutions rather they are disbursed by private financial groups or lenders known as hard moneylenders. Hard can also be interpreted in different manner as there is high upfront cost involved and exorbitant interest rates are being charged. These loans also have high origination fees and cost more than an average mortgage (in some cases going as high as twice that of average mortgage).
Hard money loan is generally explored as the last resort. It should be understood like if one is willing to sale his/her business venture or the property and he/she thinks with a little bit of renovation and repairs the money generated can be quite high then hard money loans can be the best suited option for him/her. All he needs to do is to obtain the loan utilize it make some extra money and return it.
The uniqueness of hard money loans lie in their various characteristics like they have private lending sources. They come with short interest term of one to three years they charge upfront fee on closing before three months of the due date that is quite astronomical. There is limited number of debt covenants and they are shorter in duration. Moreover the failure in repayments results in the sale of the assets to nullify the debt.
Hard money comes in forms like hard money business loans or residential hard money loans. The hard money loans are usually secured by real estates of commercial viability. Hard money borrowers get the fund based on the estimated value of the commercial or residential real estate. The lenders are interested in money generating properties such as apartments, shopping malls, office buildings, hotels, hospitals and so on. However potent income generating activities like land acquisitions, bankruptcies are also seen with interest.
People who have been turned down the mortgages by the financial institutions because of various reasons like having a poor credit history, non competence to pay as they lack in desired income etc. also look upon the hard money loans as their saviors. Hard money loans are also sought by persons who are falling behind the repayments of their mortgage or fear the foreclosures.
The investors are lured by the typically high return on their amount which banks fail to provide them. So investing in hard money loans to borrowers having equity of 30-40% in the property seems to be a better proposition to them. These loans are given on the appraised value of the commercial property unlike traditional bank criteria which seek too many documented proofs like credit card scores, tax returns and income statement of the borrowers. Lesser paper work and lesser verifications make the procedure to obtain these loans very brisk.
Author: Steve A Clark
Article Source: EzineArticles.com
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Residential Hard Money Lenders
Author: Real Estate Investor, Category: Private Loans
It would be an understatement to say that the decline in the real estate market changed the lending environment. Lenders who used to allow stated income loans no longer offer them, or they may claim to offer them but decline 99% of the stated loan submissions offered. This is extremely bad for investors who have made their incomes solely from real estate investing, or other self employed endeavors.
Primarily because when they do their taxes they have a lot of items to deduct from their income, and so their tax returns do not effect the true gross income that they earn. W2 employees do not have this problem, as they are qualified based on their full gross income and even if they do write off their incomes, the tax returns are hardly ever requested when W2’s are provided.
A good Residential Hard Money Lender, understands this is the case for full time real estate investors, and they will not have much taxable income on purpose at the end of the tax year. Even if tax returns are requested, its just to verify that the investor really does what he said on the application provided, and not to calculate debt to income ratios.
Another benefit to obtaining a Residential Hard Money Loan is that the loan is based on the After Repair Value, and not the Purchase Price. With a conventional lender, it doesn’t matter if you are buying at 10% of value; they would still require a certain percentage down payment on that purchase price. In other words, conventional lending methods ignore the fact that you are getting the property at a deep discount.
When you obtain a mortgage with a Residential Hard Money Lender you can rest assured that the After Repair Value (ARV) is being considered in the transaction. In a lot of cases the deep discount an investor is getting will allow room for the lender to roll in closing costs, rehab costs, etc… This decreases the amount of capital that an investor has to put into their projects, and therefore leaves more capital available so that he can do more deals.
If you have a real estate investment in mind, and are concerned with minimizing risk, and maximizing return on investment, you should consider utilizing a Residential Hard Money Lender. Its easier to qualify, and they are more flexible on the structure of a transaction.
Are you an investor looking to minimize risk, and maximize ROI by partnering with an aggressive Residential Hard Money Lender? Does including closing costs, rehab costs, and basing your loan on After Repair Value sound appealing?
If so, you owe it to yourself to see if you too can qualify for an Investor Rehab Loan by visiting this website: http://www.residential-hard-money-lender.com/
Michael is an active real estate investor in Florida, and also specializes in hard money financing options for other real estate investors. Being an investor, its easy to understand the importance of solid funding as a foundation for any real estate investing business.
The keys to investing with minimal risk and maximum Return on Investment are within every investors reach with the proper use of Other peoples time and Other peoples Money.
If you would like to learn more about using other peoples money for investment leverage, CLICK HERE to visit the website.
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Social Welfare Rent Allowance Questions
Author: Real Estate Investor, Category: Closing in your Investment Deal
In the current economic climate, many people have found themselves forced to apply for rent supplement, commonly known as rent allowance. Also as part of the economic slowdown, many landlords are now looking more favourably on rent allowance tenancies as a means of earning income on what otherwise would be an empty house or apartment.
Questions often asked about rent allowance include:
Who is eligible for rent allowance?
People living in privately rented houses and apartments are entitled to rent supplement if they cannot afford to pay the rent themselves. Most people relying on social welfare or HSE payments as their only source of income are entitled to receive rent supplement.
What are the qualifying conditions to receive rent allowance?
To qualify for a rent supplement, the community welfare officer for the area where the applicant is located must be satisfied that the applicant is genuinely in need of the rent supplement. The community welfare officer will check that the accommodation that the applicant is living in is suitable for their requirements and that the rent the applicant is expected to pay each week is less than the maximum rental amount payable by the HSE for the county the applicant is living in.
Is there a means test to qualify for rent allowance?
The applicant for rent allowance may also be required to fulfill a means test to assess their genuine need for assistance in paying their house or apartment weekly rent. The application form for rent supplement has more details on what documentation is required.
Can I claim rent allowance if I have a job?
People in full time employment, or who have refused a second offer of local authority accommodation within a twelve month period, or who are engaged in a full time course of education, such as a university degree, will not normally qualify for rent allowance. Some exemptions to these restrictions may be made for those people involved in the back to education programme.
People working over 30 hours a week are deemed to be in full time employment and will not be eligible for rent allowance. Married or co-habiting couples will be refused rent allowance if one of them is engaged in full time employment.
What income can I earn that will allow me to claim rent allowance?
Among the sources of income that can be received and still not affect the entitlement to rent allowance are:
Financial assistance from certain charitable bodies, state mobility allowance or child benefit, supplementary welfare allowance and any income received from the housing of students in the recognized gaelteacht areas.
Where can I get more advice?
Advice on your entitlement to rent allowance can be found at your citizens advice centre or from your local community welfare officer. The latest information on rental allowance can be found on www.welfare.ie.
This article is only intended as a basic general summary and you should always seek professional advice where necessary.
Limerick Solicitors | Social Welfare Allowance Questions Property and Houses For Rent and To Let Article Source:http://www.articlesbase.com/real-estate-articles/social-welfare-rent-allowance-questions-1431287.html
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Real Estate in Second Life
Author: Real Estate Investor, Category: Closing in your Investment Deal
Americans love games. Maybe it’s a cultural thing, and of course the passion for games isn’t limited to this country. From the beautiful simplicity of tic-tac-toe to board games like checkers and Monopoly, card games and on up to the sophisticated gaming systems like Xbox and Wii, the quest for entertainment has been a constant.
Grand Theft Auto rolled into stardom with its high-tech portrayal of a futuristic city that mimicked New York, called Liberty City. Names ranging from The Statue of Happiness, GetaLife Building and Rotterdam Tower are obvious tips of the hat to the Big Apple. But Grand Theft Auto is a bit darker and more violent than many gamers prefer and for many the search for a virtual world with nearly infinite possibilities and less crime has lead to Second Life, or SL.
Now with the current near historic real estate and housing market slump, it’s only natural that Second Life, arguably one of the most popular virtually reality games, might be even more appealing to new gamers tired of the gloom and doom of real life real estate.
Second Life started up in 2003 and is owned by Linden Lab. The whole premise of the game is based on virtual real estate, and just like in real life, money can be made by it. That’s real money, converted from the Linden Dollar currency used in the game. If you want to really enjoy the possibilities offered and have some serious fun in Second Life, you have to own land to do it. In reality players are leasing the virtual land, they don’t really own it, but the premise is the same.
A player wants a small parcel of land pays a fee every month, similar to rent. As you move up in land ownership, you pay more per month. The more land you own, the more you can do in Second Life. It’s the ultimate in real estate speculation without the risk. You have to be premium member of Second Life to own land, and the more land you own the higher your monthly fee is to Linden Lab. Players can own small parcels without paying any more than the basic monthly fee or you can opt for your own island. Linden auctions off parcels of land or you can buy and sell with other residents of Second Life.
There have been undocumented cases of residents generating a secondary income or even making their living off of real estate deals in Second Life. Reselling virtual land or renting out parcels can generate a monthly income, as strange as it may seem. If you think about it, besides the monetary aspect, it could become very addictive to some players. You would have all of the excitement of real estate deals, speculation and potential profit or loss without the headaches of insurance, mortgages or taxes. That has to be a major draw for some residents of the virtual game.
The value of land in Second Life can be increased much the same way as in real life. Residents can improve the land by building houses, adding businesses or even landscaping the property. A resident of SL could purchase enough land to develop projects as big as these luxury condos in Chicago http://www.chicagocondodirectory.com/luxury-condos and rent or sell the units for an income.
By the same token, Linden reserves the right to add more land to the game under the Acts of Linden, which can suddenly decrease the value of land by increasing the supply, should the market get out of hand.
There also used to be a First Land program to entice new players. You could join with a premium account and get a small parcel of land without having to pay a monthly fee. This practice was shut down in early 2007, however. And just like in real life, there are abandoned parcels of land that are thrown back into the rotation and come up for auction.
There are also other factors at play in Second Life that mimic real life, such as obnoxious neighbors. Some residents have been accused of creating offensive parcels of land in an effort to lower the value of neighboring parcels and force sales. To try and limit disputes, Linden started allowing covenants in 2007. A covenant basically allows anyone owning a region of land (which is supposed to hold up to 100 residents) to set rules that have to be followed or else loss of land will occur. This keeps residents who rent or own within that region from defacing property.
Of course with any type of land rush, you’ll find real estate agents and Coldwell Banker was the first company to jump on the Second Life bandwagon. The company set up shop in the virtual world in 2007 and purchased a large amount of land tracts on the mainland of SL. Its plan was to divide up the land into 520 units, with half being for sale residential homes and the other half as rental property. Coldwell planned to market the homes(which buyers won’t be able to customize or change) well below the going rate on SL and also offer everything from helicopter tours to information on real life condos, houses and property.
Coldwell Banker was not only the first large real estate company to join SL, it was the first to actually put a real life property up for sale on Second Life. Complete with a three dimensional replica of a $3.1 million estate located on Mercer Island, Washington.
With the popularity of virtual home tours and the power of the Internet growing, coupled with the housing market slump of 2008, Second Life may become an escape and even an investment for more people.
Kelly Brandon keeps you updated on Chicago condo developments, home improvement tips and real estate advice on the Chicago Condo Directory.Article Source:http://www.articlesbase.com/real-estate-articles/real-estate-in-second-life-1297812.html
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