Monthly Archives: March 2017

How the real estate industry benefit from the medical marijuana market?

March 17, 2017Uncategorizedhard money lender in california, hard money lenders in Californiabigdaddydennis

The cannabis industry has been, and always will be a major cash crop. With the passing of Prop 64, California has become a hotbed for the plant. California has always been known for its cannabis culture, and with more states jumping on the bandwagon the real estate industry can profit from it. Hard money lenders in California should consider lending in this area, as well.

So, how can a hard money lender in California make money in the industry?

This is simple, do what you do best, lend people money. You may be a little apprehensive about loaning money to someone who is involved with this market, but you may make a lot off your investment. Medical marijuana has been taking off like a rocket over that last few years and is estimated to be worth billions of dollars. Most of this comes from merchandise and of course the plant, but production is key when you are getting in the business. Since it is considered a part of the “gray market,” you have to be vigilant when choosing a piece of property that you want to use.

You need to make sure the property you are looking into follows certain guidelines. For example, the dispensary or lab you will ultimately open needs you follow certain zoning laws. You are obviously not allowed to open anything near a school. That facility also needs to be in a commercial area since it will be operating as a business.

Where do you start in the business?

Well, the first thing you need to do is find a building that you are able to use. Sometimes you will have to make sure you contact the city you are working in. If you are the main proprietor of the building another you want to start looking for a lender that wants to help you. A commercial hard money lender in California is a great way to start the process. Lenders, if they can see your vision, should be able to lend a sizable amount.

Depending on if you are planning to open a warehouse or a dispensary, you have a fairly large loan that you may be able to use for the facility. You could potentially be able to borrow a loan anywhere from $500,000 to $3,000,000. This is contingent on the size of your lender. The loan would typically last around one to three years with an interest rate of about 12 percent. Since the market makes so much money, you can pay off the loan quickly.

This real estate market is ripe for the picking

Cannabis is a cash crop that is going to be around for a while; well in California at least. Money can be made by everyone. With enough work and the right real estate team there could be shops and dispensaries throughout the state. On average, about 760,000 people benefit from medical marijuana in California. With the law still in its early stages, this is the right time to jump on the bandwagon.

About the Author: 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 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

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How do you make money fixing and flipping houses?

March 17, 2017Uncategorizedhard money lender in california, hard money lenders in Californiabigdaddydennis

Let’s face you are on here to find quicks tips to making money in real estate. Becoming a successful investor or hard money lender in California is the end goal. If you manage your money well and pick solid property you can find your fortune fixing and flipping. It will not happen overnight, but here are a few tips to get you on the right track.

One of the first things you want to do is scope out the area that you think you want to flip in. Most of the time you can save some cash by looking for auctions that are being held. Most of the time these homes are being foreclosed and will have cheaper prices than cold searching through a company.

The only thing you need to worry about is the competition. These auctions are usually held in the traditional sense where you have an auctioneer and multiple people there with you. If your purse is a little light this may be difficult. Most people can circumvent this by hiring a solid hard money lender in California that is able to lend you enough money to purchase and pay for the home you are looking to buy. Most of the time you will need to have a nice amount of collateral at stake.

When you are purchasing the home or property you want to make sure you can make money back when you are attempting a new investment. Now, this can vary person to person, but as a general rule of thumb most investor get a goal for return. For some investors, this means they will not take on an investment unless they can make a $25,000 profit on it. Others want to make enough to pay off their debt. The main thing you want to focus on is what works for you.

Use your property to your advantage

Let’s say you have a property that you are looking to purchase, and instead of selling it at a higher price you opt to keep it. Depending on the area and the quality of the home you could use the property as an addition source of income. You can rent it out to a family, or you could turn it into a hostel and charge people vacationing in your area.

You can then use the funds to ask your hard money lender in California for a short-term bridge loan. After you can purchase another home and flip the property, as well. Once you get good at this method you could end up owning multiple homes that provide you with a recurring income that can help support future flips.

You should start out on the lower end

This may seem like an obvious tip, but if you choose to purchase low-end homes you may be able to save some money. Most of the time they are cheaper which can potentially mean less of a loan you have to apply for. Most hard money lenders in California will be able to work with you and your new properties, as well.

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What you need to start flipping homes in Texas

March 17, 2017Uncategorizedhard money lender in Texas, hard money lenders in texasbigdaddydennis

When you are beginning your career as real estate investor, flipping homes can be an extremely strenuous ordeal. The rehabbing process of a home in Texas could end up costing you a lot of time and money in the end. You can make a lot of money as long as you take the time out to properly prepare yourself for every investment. There are a few trade secrets that you should keep in mind when you begin.

Knowing how to or someone that is handy.

Rehabbing is not all about buying and selling homes. Sometimes a new or not so new home, calls for you to be able to get down and dirty. Being able to install a common toilet system or a being able to run a wire through a wall are great skills to have as an investor. Like we have stated before, depending on how you are buying a home, often you cannot tour the property prior to purchase. Being able to do certain small jobs on a property can take some of that apprehension away.

On the other hand, you also need to humble yourself, no one person can conquer the world. Play to your strengths and recognize your weaknesses. If you know you have no clue on filling holes in drywall, do yourself a favor and find someone that can do it for you. Having a home that looks nice to a potential buyer trumps any expenses you may incur during the rehabbing process.

Make yourself familiar with your work

When taking on the rehab business, you need to make sure you are always on your game. From what sports history tells us the most prepared player wins the most. If you are a hard money lender in Texas, you need to constantly check how the market is changing. If you are an investor, you need to know what you are looking for. Check the area that you are looking to purchase a home in. Make yourself familiar with the types of homes that are in your area, as well.

Surround yourself with a team of experts that know the business

While you should make sure you are familiar with the business, you should also make sure you have a solid team of experts around you. Should you be handy enough to fix certain small jobs in the home, however, you do need an expert that is able to do the bigger jobs. If you are not familiar with plumbing in the home do not take it on by yourself. You may feel as though you save money, in the long run, it could end up costing more if you happen to mess something up.

You might even think you should solely bankroll your investment by yourself. Having a solid hard money lender in Texas that can loan you the money you need. Give yourself a fighting chance when you start your real estate career. You will have a lot of competition, but if you follow these steps you will ensure your success.

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Common mistakes made when looking for short sale homes

March 16, 2017Uncategorizedhard money lender in california, hard money lenders in Californiabigdaddydennis

Rehabilitating distressed homes is a popular way to make money in the real estate business. When you are starting out rehabbing can give you many sleepless nights and stress. Short sales are a great way to begin your real estate career, however, there are some mistakes many new investors make when attempting to complete a short sale.

You have read “short sale” four times now, but what are they? Basically, a short sale is when an owner of property agrees to sell even though the net profits will not cover all the debt associated with the home. As long as all parties that own the property agree to the terms of the sale you are able to buy it. If you know how your contacts you could end up with a great home, however, if you skip a few steps you could have a lemon on your hands.

What should you be on the lookout for when considering a short sale

One of the first things you should look out for when considering a short sale property is fraud. There are many laws and practices that are in place to protect from any fraud that may happen. Perpetrators are usually taken care of by the proper authorities. While there are, many resolved cases, there are many victims that fall for the scheme.

One of the most popular schemes that people are fooled by is “flopping.” Flopping occurs when a buyer or a hard money lender in California is offer a price that does not accurately represent the value of the home. Usually, victims end up paying much more than the actual value of the home.

To make it easier to understand, the owner or lien holder will withhold information from the lender about buying the property for a low price. After they will list the property at a higher value to another buyer. Once the buyer confirms they want to pay the “fake” price. After the deal is concluded the owner pockets the difference.

Use these precautions to help combat fraud

For starters, if you are the one that is buying the home one of the first things you should do is go through the home. Make sure you take time out to go through every nook crawlspace in the home. With short sales, you are able to take a walk through of the home before you commit to purchasing it. Many foreclosed homes will have underlying cosmetic issues that you cannot always see.

Things like foundation repair, mold and mildew or electrical malfunctions can cost you more money in the end. Make sure you have the proper professionals come to clear the home for anything you might feel is wrong.

In regard to the proper authorities, hard money lenders in California also want to make sure the property is appraised by a trusted building inspector. Having an extra pair of eyes will make sure nothing slips through the cracks. When taking on a short sale make sure you cover all your loose ends.

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How to protect yourself from getting scammed by hard money lenders in California

March 16, 2017Uncategorizedhard money lender in california, hard money lenders in Californiabigdaddydennis

A sucker is born every minute. This is a hard pill to swallow for some people, but it is true and many lenders will use a person’s lack of knowledge to their advantage. Which is why we at Level 4 Funding want to make sure you are covered when dealing with hard money lenders in California.

In the state of California, there are hundreds of hard money lenders that you can go to for your loan needs. Before you ink any deal, you want to make sure that you do all your research. You have to become a detective when searching for a potential lender. Scour thousands of reviews from past clients if need be. Find everything you can about the lender and the firm they represent.

If they have open cases on with the Better Business Bureau make sure you bring it up when you meet with the lender. If the firm is not recognized by the BBB, which is not uncommon for many firms, you can try sites like California Real Estate Fraud are great places to start. If you cannot find enough information on sites like this, try contacting past clients personal via email. Some hard money lenders in California will post fake reviews on their company website to keep up the appearance of a legitimate business.

What if you are already sitting in the lender’s office already?

Simple, keep your composure and listen for certain clues that will tip you off to impropriety. It could be as small as the lender being too eager to give you a loan before hearing what you plan on doing with the property.

One of the biggest things that trip people up are the fees associated with the loan they are applying for. Take bridge loans, for example, most hard money lenders in California will charge you a fee anywhere from $2,500 to $15,000. Yes, it is a lot but you need to make sure you are committed to the project.

That being said, if the lender asks for a fee higher than that you should not go through with the deal. If the loan you are looking to borrow is less than the fee something is most likely off with the lender.

REO fraud is popular with some hard money lenders in California

An REO property, or a real estate owned property, is sold by the lender. Many people fall prey to this scam due to a lack of research. What usually happens is the lender sells the property for a relatively low price to a secondary buyer then sells the property at a ridiculously high price. If you do not look into the past buyers and prices you could fall victim to this.

Many of the frauds are beginning to eliminate the middleman altogether and just selling the property for a high price. Investors can prevent being taken advantage of if they take the proper precautions when looking for lenders. Peace of mind is worth more than a new property.

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Common setbacks new investors run into when buying real estate

March 16, 2017Uncategorizedhard money lender in Texas, hard money lenders in texasbigdaddydennis

There are certain careers that are deemed sexy. For the most part, they fall into two categories; it gives you freedom or you are in a position of power. As a real estate investor, you are able to go in between the two. Most of the time you are able to pick up and do it wherever you want, and likely you are your own boss. This makes real estate investment sexy to most people. It is also the reason many people jump into the real estate investment career path.

With so much competition in the real estate industry if you are not careful you could run into a few walls. In fact, in your first year, you may quit. So, here are a few setbacks you should avoid when you are taking on your first investment.

You want to have someone in your corner

For some people owning their own business is a top priority when entering the working world. For the most part, you are able to do this when working in real estate, but you have to start from the bottom first. It is safe to say that your father did not give you a small loan of $1 million to start your career, so to get ahead you will need a partner. Some newbies may need more than one partner to help them.

Not asking for help on a deal or for information on a new find is a huge mistake. Yes, there will be times when your colleagues in your radar will try to take care of the competition, but you will need those people, as well. It is the symbiotic relationship that you share with other investors that allow you to grow in the business.

Make sure you are getting out of your comfort zone. In California, there are conventions and conferences that you can attend to meet people. Hard money lenders in California frequent these places often. Since you will likely apply for loans this works to your benefit. Having multiple partners that specialize in different areas will help you build your company.

Overestimating the value of a property can cost you money

Once we complete a project it is common to be proud of what we did. It is expected. You spent hours planning on the different type of tile you want for the backsplash. You talked to at least ten hard money lenders in California trying to get a quick bridge loan for the property. Now, you want the recognition for the hard work you put into the home or property you bought. So, you decide to overprice the actual value of the home.

Many novice investors will do this, and it is understandable, but you must also realize the market does not always work the way you want it to. Just because you had to pay a large sum of money at auction does not mean you will get all your money back.

Depending on the economy, geography and a bevy of different factors you may need to lower your price to sell your property. No one said it would be easy, but you have to stick with it to win in this game.

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Some things to know buy a distressed property take a look at this

March 16, 2017Uncategorizedhard money lender in Texas, hard money lenders in texasbigdaddydennis

One of the most common, and most likely the most profitable, ways to make money in the real estate business is to buy older homes that have yet to be renovated. After you buy them you spend a few months, or with the help of T.V. magic, a few days, fixing the property up to drive its resale value. This is called “fixing and flipping.” Many investors start their career in this category since most of the time all you have to do is find and buy a home.

But, before you decide to take on the flipping market there are a few things that you need to acclimate yourself. For example, most of these homes are bought using bridge loan. Bridge loans are usually short term. Most are paid off at the conclusion of a sale, or a few months after the property is listed. Most hard money lenders in Texas will loan you more money if you need it, but for the most part, a bridge loan will suffice.

Now it is time for you to venture into the wild

After you have figured out where you will go to for your loan, there are some more things you need to make yourself aware of. For starters, when you begin looking for a fixer upper, one of the best places you can find a property that you can flip is an auction. Most of the time you will not have to pay an insane amount. Even though the homes may look like they survived a few wars, most investors will make great finds.

Most of these auctions are held during or after the homes have foreclosed. Often the auction is organized by a trustee. The trustee is the person that holds the note on the property; this could be someone that is related to the previous owner, or it could be a hard money lender in Texas. Some investors do have an easier time at these auctions since they automatically know what they are looking for.

If you are inexperienced with the auction platform you should go to a few dry runs before you start bidding. If you plan to go to an auction you should also note that you will not be able to go inside the property beforehand. This makes it a toss-up; you could find a diamond or a lump of coal.

If you want a better option you could try an REO

An REO, or real estate owned foreclosure, is like the nice twin of the two. Basically, it is like an auction, however, the lender actually owns the property. Say you have worked with a hard money lender in Texas for a few years and they recently acquired a new property. Depending on the strength of the relationship you could have a first look at the property.

With an REO, you are able to go through the property and look around. Usually, you would make an appointment with the lender and walkthrough. While this may seem like a better option you are essentially held over a barrel. Since the lender has some skin in the project you may have to pay full price. You should meet with your fellow investors before going through with either option.

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When is the right time to cut your losses in the real estate business?

March 15, 2017Uncategorizedhard money lender in Texas, hard money lenders in texasbigdaddydennis

The real estate industry can be extremely tumultuous under normal conditions. If you are doing it correctly, you will run into a few extra problems that come with investing. What separates the inexperienced investor from the pro is knowing when to throw in the towel. Now, we are not saying that as soon as you find a water leak in your property you should give up, but you need to be aware of your investment as all times.

For many investors, this means having a solid exit strategy before you are able to commit to a new project. A solid exit strategy allows you to drop one project and go after another within a few days. For some investors, this could be after a certain number of repairs exceed their comfort level. Along the lines of property renovation, an investor could have a financial cap set in place before they decide to pull out on their investment.

Research makes perfect in real estate

An experienced real estate investor takes their time to thoroughly vet a property and the geographic area before making an offer. They will most likely go through an extensive checklist before making a decision. Sometimes hard money lenders in Texas are able to help you with your research, however, most of the legwork is up to you.

Enough research can tell you the right amount of money you should put into the property. Often many investors bite off more than expected with a property. In the event that the repairs begin to outweigh the possible revenue that you are expecting you should begin implementing your exit strategy.

When is time to step away from your investment?

The moment you feel as though you are not going to make any profit on the property is the time you step away. Some investors will tell you to stick it out a little longer, while most will tell you to stick with it. In the long run, you must do what is right for you. Maybe you have expended all the money you set aside for the project.

Most of the time at this point other investors will not want to or be able to help you in your investment. One of the most important details that you want to remember about real estate is timing. Your timing is everything.

Say you ask your hard money lender in Texas for an additional loan from more construction, however, recently there has been a decline in the demand for homes. Now, you have a home that may not sell for the next two or three months. With a hard money lender, usually you will have a fairly short term loans this will not work.

With an exit strategy, you give yourself more options

Allowing yourself to leave your investment if you need to, till ultimately save you thousands of dollars in the end. It may seem like a loss at first, but a loss will hurt much worse if you are left with debt.

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Two rules to being a successful real estate investor in California

March 15, 2017Uncategorizedhard money lender in california, hard money lenders in Californiabigdaddydennis

We all see those commercials beckoning us to go to California to visit. What if you want to stay, though? Sure, the traffic and smog can be unbearable at times, but California has a great real estate. When you are living a such a fast-paced city it is easy to get jaded. With cities like Los Angeles and San Francisco, it is easy to get in over your head when taking on a new property.

So, what do you do? Well, that is what Level 4 Funding is for, we have the tools you need to be a successful real estate investor in California. As far as real estate goes the west coast can be one of the toughest places to “stake your claim.” Clichés aside here are a few tips that you can implement to be successful in the real estate business in the Golden State.

It is better to have allies in the real estate business

When you are getting into the business, it is beneficial to have as many people in your corner as possible. For some, it may be investors, but for many, it will be lenders. Hard money lenders in California act as gatekeepers on the market. They can tell you where to look if the property you scoped is not the right fit, or they can give you advice on how you should restructure your approach.

Having a lender that is willing to teach you the basics of borrowing and lending will pay dividends in the future. Yes, some of them will come off a money hungry profiteers, but most of them are here to help. A hard money lender in California can guide you in the right direction when you are looking for your next project. Maybe your focus should be on the Bay area instead of downtown LA. Above all having a solid lender in your pocket will allow you more money when the time comes and better resources.

Proper preparation makes perfect

Yes, that is a bit of a tongue twister, but alliteration aside this is spot on. One of the best things a new investor can do is research. Before you take out a loan or call an auctioneer, doing the proper research will help you tremendously.

This first thing you should do is research the market that you want to be a part of. If you want to focus most of your investments on beachfront bungalows, make sure you are looking at the geography of the surrounding area. Hard money lenders in California will take this as a sign that you are willing to put in the work for your property.

If you plan accordingly you will also be able to avoid some of the less than spectacular properties that will ultimately cost more money.

Above all make sure all your funds are in order

If you want to play in the big leagues you have to learn how to handle your money with care. One thing that puts many would be investors in the red is miscalculating the assets need for a home. Many times, there will be unexpected fees that you will need to pay, but you want to be comfortable when that time comes.

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Don’t Like The Risks That Come With Many Commercial Lending Options? Then Give One Of These A Try!

March 14, 2017Uncategorizedcommercial lendingbigdaddydennis

Different commercial lending options come with different levels of risk. But there are other routes you can take to finance your venture if you don’t feel good about any of them.

When we think about financing, we tend to think about banks, credit unions, and places like them. They are the traditional lenders; the ones most people are aware of—but not the only ones. Luckily for many with the entrepreneurial spirit, there are more commercial lending options available than the banks and credit unions.

But no matter which option you choose, there is going to be a certain level of risk you may or may not be comfortable with having. Does that mean you are screwed? Does it mean you can’t go into business for yourself? Absolutely not!

Alternative And Inexpensive Options To Traditional Commercial Lending Choices

The bank doesn’t see you as worthy of a loan, and you don’t like the idea of having to accept the terms you are being quoted from local hard money lenders. Some would say oh well, take the best of the bad deals they are getting, and hope for the best.

But you don’t have to do that. There are options other than whatever the commercial lending industry is giving you:

• Credit Cards: Crazy, right? But aren’t the interest rates kind of high to be using credit cards to finance a business? Depending on how bad your credit is—yes, but if it isn’t terrible, you can get cards with APR’s around 16 percent when the only loans you were seeing from alternative lenders had APRs in the 40 percent range.

• Business line of credit: this can be a very good option if you can get approved for it. You’ll have access to the funds you need and will only have to pay interest on whatever money you use. A business line of credit can save you when you incur an unexpected expense and help you navigate the lean times without having to tighten the belt too much.

• PayPal working capital: Many people are not aware of this as a financing option, but if you allow customers to make payments to you through PayPal, it can be a great option. Rather than do a credit check, they will take a look at your transaction history and loan you up to 15 percent of annual PayPal sales. It can be done quickly, and you don’t have to make payments. They take a cut from your daily sales.

• Square Capital: While PayPal is a great option for e-commerce businesses, Square is a great one for retail establishments. The company began as payment processing service but has expanded into the world of small business loans. Like PayPal, it will look at your sales history to determine how much you can be approved to receive. Also, like PayPal, they will simply deduct a percentage of your daily sales, so you don’t have to worry about making payments!

Traditional Commercial Lending Options Are Not Always The Right Options

We’ve been conditioned to accept the traditional ways are the right ways, and you must do things the traditional way to succeed—but that is not true. Many of the most successful business people thought outside the box to create their product. So there is nothing wrong without going outside the box to satisfy your financing needs.

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Monthly Archives: March 2017

How the real estate industry benefit from the medical marijuana market?

How do you make money fixing and flipping houses?

What you need to start flipping homes in Texas

Common mistakes made when looking for short sale homes

How to protect yourself from getting scammed by hard money lenders in California

Common setbacks new investors run into when buying real estate

Some things to know buy a distressed property take a look at this

When is the right time to cut your losses in the real estate business?

Two rules to being a successful real estate investor in California

Don’t Like The Risks That Come With Many Commercial Lending Options? Then Give One Of These A Try!