If you’ve been reading up on Arizona Bridge Loan options, you’ve probably only gotten the details on how banks operate. To get the full story, you should learn what it’s like to get one from a hard money lender too.
1. Banks typically require good or excellent credit. Getting an Arizona Bridge Loan from a bank isn’t too much different from qualifying for any other form of financing, but it’s a bit riskier for the bank than other forms, so they often set the bar a bit higher. Because banks typically place your credit score at the top of the list of considerations, many people don’t qualify.
2. Banks expect a significant down payment. While there are government programs to help people purchasing homes to live in and businesses when they don’t have a large down payment, those options diminish with this type of financing. They’re fairly stringent on having at least 20% down, and often more if you didn’t meet other criteria.
3. Banks are tied down by more regulatory red tape. They’re pickier about what types of businesses they fund, how long those people have been in business, what their debt-to-income ratio is, and if you’re approved, it generally takes longer to get funded.
How Can I Tell Which Form of Lending is Right for Me?
If you need to move fast on purchasing a property, an Arizona Bridge Loan may be the ideal choice. It’s a short-term option that’s often leveraged by real estate investors who don’t want to pay down a balance over a long period of time. Instead, they usually plan to refinance later; perhaps when they’ve cleared up issues that prevented them from getting a traditional mortgage, be it a credit score, owning multiple properties, or the condition of the property they’re buying. Other times, the goal is to pay off the balance once the property sells. This is what homeowners do when they take on a short-term loan to buy a new house before they’ve sold their old one or what people who buy distressed properties do—once the repairs are made, they can then sell the house for profit and pay off the balance. While bank options typically offer lower rates for theirs, they obviously don’t approve everyone, and so Texas Hard Money Lenders step in to fill the niche banks leave behind.
A seasoned broker will help you find the right financial product for your needs—and at the best rates too.
If you approach a bank for an Arizona Bridge Loan and don’t get approved, it ends there. And, if you do get approved, you’re given a rate that may or may not be better than what others are offering. When you work with a broker, it’s his job to find a product that meets your needs, so it’s easier to get approved in the first place, and he’ll also know what rates are available through various lenders, so he can help ensure you’re not paying more than you need to. If you think short-term funding can help you fill a gap, tap into the expertise of a seasoned broker.
Level 4 Funding LLC
Hard Money Lender
Hard Money Loans
Hard Money Loan
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
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 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 43 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.