Monthly Archives: October 2019

100% LTV Hard Money Loans in Arizona

Finding the right lender is your first step in starting your real estate investment portfolio. There are 100% loan-to-value (LTV) Hard Money Loans in Arizona—you just need to know where to look.

It has been said that you have to have a ton of cash to get started in real estate. On the contrary, below are some options to get your deal funded without having to lay out massive cash amounts. If you are one of those people with money sitting in the bank and earning 2% interest and inflation at 3%, then the true value of your money is that you are losing 1% each year. If you want to keep up with inflation, high yield savings accounts cannot do the job.

On the other hand, if you seek out An Arizona Hard Money Lenderor private lender, the interest rate is often going to be in the range of 12% to 15% for a Hard Money Loans in Arizona. To approach one of these lenders and acquire the funds you need to break into the real estate market, you will need to know how to approach them and present your project. Develop a business plan of your project, explaining how you have worked out the details. Make sure to give enough information to answer a lender’s questions.

A private Hard Money Loans in Arizona is secured by real estate. When writing the business plan, make sure you emphasize that your maximum loan to value is 75%. Conventional Arizona Hard Money Lenders have a much tougher standard for securing a loan. This is a win-win situation because you do not need to dole out cash while the investor (lender) makes 12% to 15% for taking the risk.

Financing by Seller

If you are seeking 100% seller financing, then you need to search for a motivated seller with a property they want to unload. Understand that the property they are looking eagerly to sell will be in poor condition, but if you are handy you may be able to make a subpar property into a great investment. If the seller is utilizing the services of a Real Estate Agent, this house will be competing with a move-in-ready house. The property may be on the market for a considerable time and, if the property sells, the owner of the property will have to pay approximately a 6% commission. If the seller carries the mortgage they benefit because of the renovation of the house. The seller carrying the mortgage also gets paid a higher interest rate. When the house sells, the investor and seller both make money from the sale of the house resulting in a win-win for both parties.

Obtaining a Line of Credit from a business is another option to securing financing.

If you have an established business or a newly formed company, obtaining a line of credit is another way to secure 100% financing. Seek out a loan company that has no restrictions on how the money can be used. Most hard money lenders require that 10 to 30% be put down for a Hard Money Loans in Arizona. If you are an experienced rehabber, there may be some 100% lenders out there, but you will have to pay 3 or 4 points and 15% interest and may even have to split the profit after the sale of the property. At Level 4 Funding, our success is your success which is why our rates start as low as 5.99% with flexible terms that range from 3 to 60 months. Call us for a no-obligation quote.

                                                                                           Dennis Dahlber Broker Ri CEO Level 4 Funding LLC

Dennis Dahlberg

Broker/RI/CEO/MLO

Level 4 Funding LLC

Hard Money Lender

Hard Money Loans

Hard Money Loan

Arizona Tel:  (623) 582-4444

Texas Tel:      (512) 516-1177

Dennis@level4funding.com

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:  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.

© 2019 Level 4 Funding LLC. All Rights Reserved.

Copyright | Privacy Policy | *Terms & Conditions

What are Fix and Flip Loans?

The fix and flip investment strategy involves purchasing the ideal property that is ripe for renovation or a quick turnaround. There are several types of Arizona Fix and Flip Loans that can help make your dream a reality.

The fix and flip real estate investment strategy involves purchasing property that is in need of either minor renovation or major construction. After improving the property, you then sell it for a profit. As simple as it sounds, there are many moving parts and areas that require a certain depth of knowledge. Let’s dig a little deeper.

You purchase a property through an auction or a foreclosure or, lastly, a bank foreclosure sale. At that point, depending on the property, you may choose to sell it “as is.” A true fix and flip, however, involves improving the property first, adding value, and then selling it. Improving the property can range from small but important updates to the kitchen and bathrooms to a complete renovation of a home.

A successful fix and flip involves many components. As a Fix-and-Flipper, you must be able to acquire a property at a price that allows you to do the renovations and make a profit. You, as an acquirer, must know your market, as a project manager, you must be able to manage the various contractors to execute the improvements, and, finally, you need to be able to secure funding for your project. One major hurdle is obtaining financing from a bank. You will find that this process may too long and costly. For example:

· Typically, the fix and flipper is opportunistic and purchases distressed properties. This means that time is of the essence and a lengthy and cumbersome bank loan will delay the process.

· The bank route depends heavily on the buyer’s credit history. Your track record and expertise in fix and flip investments is usually discounted by banks.

· The bank route may not lend for improvement costs for a fix and flip property.

Fix and Flip Loans—The Bridge Loan

Loans for fix and flip investments are typically known as Arizona Bridge Loans. The bridge loan is the “bridge” between the sale of the purchased property once renovated. These loans are short term in nature and secured by the real estate. The number and type of Arizona Fix and Flip Loans are varied. Some of the different types are:

· Purchase the property: A seller has a distressed property and the buyer has the opportunity to purchase the property at a deep discount, make some minor renovations, and then sell it.

· Renovation loan: A buyer has the opportunity to purchase a single-family home. The borrower will renovate the home to make it more eye appealing and modernize it with a new kitchen, bathroom, painting, and landscape, and then put the property up for sale.

· Arizona construction loan: A vacant piece of land is available with a dilapidated single-family home. The borrower demolishes it, replaces it with a 2-unit duplex and then sells it.

At Level 4 Funding, we work with hundreds of private Arizona Hard Money Lenders, many of which specialize in fix-and-flip loans. Our interest rates start as low as 5.99 percent with terms that range from 3 to 60 months.

The cause of capital inefficiencies in the lending market allows Arizona Hard Money Lenders the opportunity to provide liquidity while the borrower pays higher interest, organizational costs, and points. These loans are collateralized by the property or land involved in the project. The term of the loans is usually 12-24 months. An individual who invests in Arizona Fix and Flip Loans has their money going directly to the originator who then provides their clients with the working capital to fund their projects. At Level 4 Funding, we offer some of the best interest rates in the market. Call us for a no-obligation quote

                                                                                       Dennis Dahlber Broker Ri CEO Level 4 Funding LLC

Dennis Dahlberg

Broker/RI/CEO/MLO

Level 4 Funding LLC

Hard Money Lender

Hard Money Loans

Hard Money Loan

Arizona Tel:  (623) 582-4444

Texas Tel:      (512) 516-1177

Dennis@level4funding.com

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:  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.

© 2019 Level 4 Funding LLC. All Rights Reserved.

Copyright | Privacy Policy | *Terms & Conditions

Loans for Flipping Houses: Why You Should Avoid the Bank

Many are enticed to get into the flipping business, either by reality television or the prospect of tidy profits. But few people just getting into the business have cash in their pocket to buy and remodel a house on their own, and most need financing. If you are new to the flipping business, learn why banks and every other financing method out there is less than ideal in the case of fix and flip loans.

Someone new to the flipping business might leverage the equity in their home, refinancing their personal residence to embark on their first flipping project. Is putting your actual house on the line to flip another house a good idea? I’ll leave that for you to decide.

Another strategy is to take out a small conventional loan to purchase the house, and then take out an unsecured loan to cover the cost of remodeling. This strategy is basically like getting a credit card to pay for your flipping project, and paying bills with a credit card is never a sound financial strategy. So why not just go to your friendly neighborhood bank?

A conventional loan will always fall short when it comes to fix and flip loans

Many novice real estate investors are lured to banks by the prospect of lower interest rates, but conventional lenders fall short in almost every respect the case of flips. First, the tedious application process could cause you to miss out on the best investment opportunities, as foreclosures and short sales move quickly and traditional lenders simply can’t keep up. If the property you have in mind is anything less than livable condition, your application will be denied outright. But, there’s a bigger reason to avoid going to the bank to finance flips

Without exception, even if a bank miraculously finances your flip, the loan will not cover the cost of your renovations. Ever. Banks give loans as a percentage of a property’s current value. Your bank loan might cover 90 percent of a $50,000 shack and this loan will get you that shack but nothing more. If you want to remodel the home thereafter, you will need to take out another loan.

So home equity, unsecured loans, and even banks fall short when it comes to financing flips, but not all hope is lost.

Hard money loans remain the best way to finance house flips

A cursory search of the term “hard money” might make you balk at the double-digit interest rates offered by these lenders. Understand that those double-digit interest payments don’t amount to much as your plan should be to sell the property within a few months.

What sets hard money apart in the case of flips is that these loans are given as a percentage of the property’s value after it’s been repaired. Unlike a bank loan, a hard money loan can not only can you get enough money to purchase a distressed home, but you also get the money you need to improve it.

This factor sets hard money apart from other types of financing, be it bank loans, unsecured loans or equity loans. Home equity loans put your house at risk, unsecured loans are expensive, and bank loans will not cover the full cost of a flipping project. If you want to get into the flipping business, your best bet is and likely always will be hard money.

                                                                                   Dennis Dahlber Broker Ri CEO Level 4 Funding LLC

Dennis Dahlberg

Broker/RI/CEO/MLO

Level 4 Funding LLC

Hard Money Lender

Hard Money Loans

Hard Money Loan

Arizona Tel:  (623) 582-4444

Texas Tel:      (512) 516-1177

Dennis@level4funding.com

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:  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.

© 2019 Level 4 Funding LLC. All Rights Reserved.

Copyright | Privacy Policy | *Terms & Conditions

Simple Strategies to Risk Less When it Comes to Fix and Flip Loans

More and more are getting into the flipping business. Look at the statistics. In 2017, 207,888 single family homes and condos were flipped, the highest number of homes flipped since the pre-recession heyday of 2006. The average profit made per flip last year was $68,143. That’s serious money. The recent rise in flips indicates that many new people are getting into the business and its likely most of them are making use of fix and flip loans to do so. Learn some mistakes you want to avoid when it comes to financing flips.

Financing flips is in no way similar to financing a primary residence. These loans are for the short term, as no one in the flipping business plans to hold onto their property for the standard 15-30 year period. They are also expensive, and interest charged usually amounts to the double digits.

Considering the expense and the short-term nature of these loans you want to ensure that:

1. Your property can sell quickly

2. That you take out the smallest loan possible.

Consider the following as examples of what not to do in the case of fix and flip loans

• The HGTV’er: This flipper purchases a property that is pretty much livable. With just a fresh paint job and some new carpets, it would be a quick-and-easy sale, but she decides to go big on the renovations instead. She takes out a rather large loan to reconfigure the home’s entire layout. After the walls come down and the dust settles, our flipper discovers that her extensive demolition didn’t add much to the value after all. All that unnecessary work took time, a time during which she was paying those double-digit interest rates and this cost her several thousand dollars.

• The Designer: Our next flipper is obsessed with clean, minimal interiors and slick German appliances. Her vision for her flip is taken straight out of a Mies Van Der Rohe picture book, and again she takes out a rather large loan to bring her vision into reality. In the end, the sparse, minimal interior, Italian concrete countertops, and full picture windows didn’t contribute much to the home’s final sale price. Her property sits idly on the listings for many months because her vision didn’t match the expectations of most buyers. While her house sits on the market, she continues to make those hefty interest payments on her larger-than-necessary loan.

Risk less in the case of fix and flip loans by using these simple strategies:

• Consider the minimum amount of renovation needed to bring the property to a marketable standard. The HGTV’er didn’t do this, and thus she took out a loan that was larger than necessary.

• Only add features that add real value. The designer might have remodeled the home in a way that was aesthetically pleasing, but not only was her vision expensive, but it also didn’t mesh with the expectations of most buyers. She took out a larger-than-necessary loan but also the features she added hindered her ability to resell and therefore pay off that loan.

If you don’t employ these tactics, you could end up taking out an unnecessarily large and expensive loan to finance your next flipping project.

                                                                               Dennis Dahlber Broker Ri CEO Level 4 Funding LLC

Dennis Dahlberg

Broker/RI/CEO/MLO

Level 4 Funding LLC

Hard Money Lender

Hard Money Loans

Hard Money Loan

Arizona Tel:  (623) 582-4444

Texas Tel:      (512) 516-1177

Dennis@level4funding.com

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:  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.

© 2019 Level 4 Funding LLC. All Rights Reserved.

Copyright | Privacy Policy | *Terms & Conditions

Construction Loans: The Dangers of Going Off-Budget

Construction loans present a risk to both borrowers and lenders. As a borrower, you don’t have any assurance that your project will go according to plan and your lender has nothing to fall back on besides a hole in the ground and the sky above it if you default. For these reasons, construction financing is distributed piecemeal in the form of draws as construction proceeds.

The draw process has all sorts of exciting risk factors to building projects, the main one being that you have to have a plan and stick to it.

Because construction financing is given out in stages, you as a borrower need to do everything in your power not to divert from your initial budget. Any diversion on your part and you might not have enough money to finish your project. If you don’t stick to your budget, disaster might be around the corner, as the following purely hypothetical scenario will clearly illustrate.

What not to do when it comes to construction loans

Our borrower is in the middle of building his dream home: a glass box perched over a beach. He’s had a clear budget thus far, but he feels the initial 5 x 5, floor-to-ceiling windows won’t adequately capture the view, so he orders, new 20 x 5 windows which have to be shipped from Italy and cost $20,000 apiece. No matter; he ignores the pleas of his grumbling architect who now has to reframe that whole section of the house to accommodate the new windows. “There’s enough in the budget this month,” the borrower says, and he is right about that, to a point.

Construction proceeds over the next few months as only a bit of minor work is needed, but then, sure enough when it comes time to install the drywall, our poor builder can’t afford the cost of installation.

He asks his lender to increase his loan balance because he just needed to have those new windows, but it’s safe to say the lender rejects his request for more money. Work ceases on his glass villa. Until he can get another loan, the house will remain empty and unfinished. Worse yet, he’s still on the hook to pay the loan for his unfinished dream home.

The best way to risk less when it comes to construction loans is to stick to your budget.

The above story may seem far-fetched, but such situations are not uncommon. If you change your mind on a whim in the middle of construction, you can run out of money and your lender might not agree to give you more.

Do yourself a favor and have a plan and stick to it, unlike our hypothetical builder. Cost overruns are inevitable in any construction project. Most reasonable lenders are willing to work out some contingency if an unforeseen expense comes up, but few lenders are going to give you more money just because changed your mind on a whim. Staying as close to budget as possible is the best possible way to ensure you will have the funds needed to complete your construction project.

                                                                           Dennis Dahlber Broker Ri CEO Level 4 Funding LLC

Dennis Dahlberg

Broker/RI/CEO/MLO

Level 4 Funding LLC

Hard Money Lender

Hard Money Loans

Hard Money Loan

Arizona Tel:  (623) 582-4444

Texas Tel:      (512) 516-1177

Dennis@level4funding.com

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:  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.

© 2019 Level 4 Funding LLC. All Rights Reserved.

Copyright | Privacy Policy | *Terms & Conditions

Bridge Loans: Fueling the Costs of 1031 Exchanges

1031 exchanges allow you to defer the payment of capital gains taxes by reinvesting your profits into another similar investment. Most industries lost out due to last year’s tax overhaul, but not the real estate industry. Real estate investors can still indefinitely defer payment of income taxes on profits earned from their ventures so long as they roll those profits into the purchase of another investment property. But, there is a deadline you have to meet to qualify. If you need financing to purchase your next investment property, you might want to think twice about going to the bank. Learn why bridge loans are perhaps the best way to finance 1031 exchanges.

1031 exchanges are IRS policies and therefore regulated by perhaps thousands and thousands of opaque guidelines. For this article we are only going to focus on one: You have to secure the purchase of your next investment property within 120 days for your next purchase to qualify as a 1031 exchange.

With Bridge Loans you risk less when it comes to 1031 exchanges

Going to the bank could cost you dearly when it comes to 1031 exchanges. Remember that you only have 120 days to close on your next investment property. Day by day you lose assurance that you’ll be able to acquire your new investment property on time.

For example, if you are an active investor in single-family homes and your recent sale just closed, you might consider investing in a small apartment complex. Of course, the sale of a house isn’t going to cover the cost of purchasing an apartment complex, so you need financing.

You go to the bank, and the loan officer points out your lack of experience in this area. They ask for more documentation. Days plod by, documents pile up, and sure enough, the 120-day window closes. Now, you are on the hook to the IRS.

If the 120-day window passes, you will have to pay capital gains taxes on the profits you earned from that last resale. Depending on your earnings, this could end up being a significant expense.

If you need financing to secure the purchase of your next investment property to complete a 1031 exchange, spare yourself the worry and the hassle and go to a bridge lender instead.

Bridge loans offer real estate investors the flexibility and certainty needed to complete 1031 exchanges.

• Certainty: Bridge lenders underwrite their loans based on the value of the property you want to purchase, which simplifies the application process. When it comes to bridge lenders, loans can close in as little as a week, well within the 120-day time limit imposed by the IRS.

• Flexibility: Bridge financing is just that: a “bridge” between the initial purchase of an investment property and its eventual refinancing. You secure funding from a bridge lender, purchase your next property, complete the 1031 transaction on time, and then refinance to a cheaper permanent loan.

Banks aren’t going to move any faster just because you have a critical deadline, and when it comes to 1031 exchanges, going to a bank could cost you dearly, so approach a bridge lender instead.

                                                                       Dennis Dahlber Broker Ri CEO Level 4 Funding LLC

Dennis Dahlberg

Broker/RI/CEO/MLO

Level 4 Funding LLC

Hard Money Lender

Hard Money Loans

Hard Money Loan

Arizona Tel:  (623) 582-4444

Texas Tel:      (512) 516-1177

Dennis@level4funding.com

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:  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.

© 2019 Level 4 Funding LLC. All Rights Reserved.

Copyright | Privacy Policy | *Terms & Conditions

Bridge Loans: Fueling the Costs of 1031 Exchanges

1031 exchanges allow you to defer the payment of capital gains taxes by reinvesting your profits into another similar investment. Most industries lost out due to last year’s tax overhaul, but not the real estate industry. Real estate investors can still indefinitely defer payment of income taxes on profits earned from their ventures so long as they roll those profits into the purchase of another investment property. But, there is a deadline you have to meet to qualify. If you need financing to purchase your next investment property, you might want to think twice about going to the bank. Learn why bridge loans are perhaps the best way to finance 1031 exchanges.

1031 exchanges are IRS policies and therefore regulated by perhaps thousands and thousands of opaque guidelines. For this article we are only going to focus on one: You have to secure the purchase of your next investment property within 120 days for your next purchase to qualify as a 1031 exchange.

With Bridge Loans you risk less when it comes to 1031 exchanges

Going to the bank could cost you dearly when it comes to 1031 exchanges. Remember that you only have 120 days to close on your next investment property. Day by day you lose assurance that you’ll be able to acquire your new investment property on time.

For example, if you are an active investor in single-family homes and your recent sale just closed, you might consider investing in a small apartment complex. Of course, the sale of a house isn’t going to cover the cost of purchasing an apartment complex, so you need financing.

You go to the bank, and the loan officer points out your lack of experience in this area. They ask for more documentation. Days plod by, documents pile up, and sure enough, the 120-day window closes. Now, you are on the hook to the IRS.

If the 120-day window passes, you will have to pay capital gains taxes on the profits you earned from that last resale. Depending on your earnings, this could end up being a significant expense.

If you need financing to secure the purchase of your next investment property to complete a 1031 exchange, spare yourself the worry and the hassle and go to a bridge lender instead.

Bridge loans offer real estate investors the flexibility and certainty needed to complete 1031 exchanges.

• Certainty: Bridge lenders underwrite their loans based on the value of the property you want to purchase, which simplifies the application process. When it comes to bridge lenders, loans can close in as little as a week, well within the 120-day time limit imposed by the IRS.

• Flexibility: Bridge financing is just that: a “bridge” between the initial purchase of an investment property and its eventual refinancing. You secure funding from a bridge lender, purchase your next property, complete the 1031 transaction on time, and then refinance to a cheaper permanent loan.

Banks aren’t going to move any faster just because you have a critical deadline, and when it comes to 1031 exchanges, going to a bank could cost you dearly, so approach a bridge lender instead.

                                                                         Dennis Dahlber Broker Ri CEO Level 4 Funding LLC

Dennis Dahlberg

Broker/RI/CEO/MLO

Level 4 Funding LLC

Hard Money Lender

Hard Money Loans

Hard Money Loan

Arizona Tel:  (623) 582-4444

Texas Tel:      (512) 516-1177

Dennis@level4funding.com

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:  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.

© 2019 Level 4 Funding LLC. All Rights Reserved.

Copyright | Privacy Policy | *Terms & Conditions

Hard Money Lenders: Finding the Help That’s Right for You

Hard money lenders offer real estate investors the flexibility needed to finance deals that other lenders avoid like the plague. Of course, not every lender is cut from the same cloth. Learn some of the traits of the ideal hard money lender so you can find the help that’s right for you.

When it comes to hard money, you want to look out for hidden costs. In the case of rehab projects, sometimes the loan is given to the borrower bit by bit in the form of draws. Don’t get ripped off by making interest payments on money that you haven’t received yet. These hidden interest payments can cost you thousands of dollars. Seek out lenders who only charge interest on money as it is drawn if you plan to use hard money for a rehab or construction project.

If you can seek out direct hard money lenders, do so.

A direct lender is someone who already has the funds on hand to close your deal and typically has more room to negotiate. Direct lenders raise the capital to fund their loans themselves. In contrast, indirect hard money providers fund their loans from a pool of accredited investors. In most instances, these investors have a guaranteed rate of return on their investments. Due to this fact, indirect lenders have no wiggle room when it comes to the interest rate they can offer you.

Hard money is all about flexibility, and you want as much room to negotiate the terms of your deal as possible. Even a one percent reduction in interest rate could save you tens of thousands of dollars depending on the size of your loan, so seek out a direct hard money provider who has more room to negotiate the terms of your deal.

You can seek out hard money lenders that offer you the

ability to write off interest payments on your taxes.

Say you’re a regular real estate investor. Perhaps throughout a given year, you’ve rehabbed three properties, taking out loans of around $300,000 at a 14 percent interest rate. In this case, throughout the year you’ve paid about $10,500 in interest.

Would you like to write that off that very healthy sum on your taxes? Then you need to seek out a hard money provider who can provider a 1098 mortgage interest form. Not every hard money provider can do this due to inexplicable and opaque regulations far beyond the scope of this article. If you are a regular real estate investor being able to deduct your mortgage interest payments could save you thousands of dollars each year.

In short, the ideal hard money provider saves you money in the following ways:

• They don’t rip you off with hidden expenses (i.e., charging interest on money they haven’t given to you)

• They’re able to save you money because they can offer you a lower interest rate

• The interest on the loans they provide can be deducted from your taxes every year

                                                                     Dennis Dahlber Broker Ri CEO Level 4 Funding LLC

Dennis Dahlberg

Broker/RI/CEO/MLO

Level 4 Funding LLC

Hard Money Lender

Hard Money Loans

Hard Money Loan

Arizona Tel:  (623) 582-4444

Texas Tel:      (512) 516-1177

Dennis@level4funding.com

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:  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.

© 2019 Level 4 Funding LLC. All Rights Reserved.

Copyright | Privacy Policy | *Terms & Conditions

Loans for Flipping Houses: The Dangers of Hidden Costs

Hard money lenders are the go-to source for financing when it comes to flipping houses. These lenders overlook the distressed condition of a property while giving loans as a percentage of a property’s potential value, but it is essential to carefully consider the cost structure of any hard money deal.

Some hard money deals are structured in two parts. The first portion of the loan secures the purchase of distressed property and the second portion of the loan covers the cost of renovations. The rehab portion of the loan is often distributed bit by bit as work proceeds, and this has important implications when it comes to the cost of hard money financing. The following examples will show why it is crucial to analyze the terms of any hard money deal.

In the first instance, our prospective house flipper goes to a hard money provider and proposes a two-month rehab project. The cost of closing on the ramshackle home will be $80,000, and the cost of renovations will amount to $30,000. Our first borrower takes out a loan for a total $110,000 with the rehab budget given out in two successive draws totaling $15,000 apiece. The lender offers a standard hard money interest rate of 14 percent. Work proceeds on the house things go smoothly, and our flipper resells his home earning a handsome profit of $55,320.

It seems like things worked out pretty well in this case, or did they?

You can save money by carefully considering the cost structure of hard money loans

Another flipper sees a similar property sale a block away from our first. She must have been spying on the first borrower because her proposed project is the exactly the same. The purchase price of the house is $80,000 and the rehab budget is $30,000. This borrower approaches a different hard money provider. They agree to a loan of $110,000 with a $30,000 rehab budget distributed over two draws at a 14 percent interest rate.

Suspicious glances are exchanged between the two investors as they pass each on the way to their respective work sites. Let us assume they finish work at the same time, and they resell their properties at the same sales price.

But, for some reason, our second flipper earned a profit of $56,020 while the first earned $55,320. Why? Because the second flipper carefully considered the terms of her deal. What was the critical detail in the term sheet the first flipper missed?

The first lender charged full interest on the total loan amount up front through the whole two month period, while the second lender only charged interest on the money as it was given out in draws. This tiny detail saved the second flipper $700.

Don’t make unnecessary interest payments on hard money loans

This hidden cost of hard money is something that is often overlooked, and it could cost you thousands in unnecessary interest payments. In the context of a house flip, $700 might be a small amount of money.

Let’s change the situation. What if our first house flipper’s project went on for 6 months and they had to pay that 14 percent interest rate on the full loan amount? They’d pay roughly five thousand additional dollars in unnecessary interest payments. In the context of a flip, $5,000 is a lot of money.

Don’t make interest payments on money you don’t have. Carefully analyze the cost structure of your hard money deal. If you don’t receive the full loan amount up front, ask your lender if they will charge you interest on the entire loan amount or just on the funds you’ve received from them. Analyze the terms of your hard money deal to avoid making unnecessary interest payments.

                                                                 Dennis Dahlber Broker Ri CEO Level 4 Funding LLC

Dennis Dahlberg

Broker/RI/CEO/MLO

Level 4 Funding LLC

Hard Money Lender

Hard Money Loans

Hard Money Loan

Arizona Tel:  (623) 582-4444

Texas Tel:      (512) 516-1177

Dennis@level4funding.com

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:  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.

© 2019 Level 4 Funding LLC. All Rights Reserved.

Copyright | Privacy Policy | *Terms & Conditions

Red Flags On Loans To Flip Houses in Arizona

Sometimes it can be challenging to find a good deal on Loans To Flip Houses in Arizona. But if you find a deal that looks too good to be true then it probably is fraudulent.

Getting into the flipping business takes a lot of hard work, research and time as well as a good amount of cash or a reliable lender. When you are seeking a solid lender for Loans To Flip Houses in Arizona, it is important that you understand the terms of the loan and the red flags to avoid so that you don’t end up overpaying for your loan or getting scammed altogether.

Any legitimate lender is going to be will if not actually eager to disclose all of the loan terms upfront. This is simply a way for the lender to know that you are serious and to avoid wasting his or her time on a borrower who can’t afford the terms of the loan or one who is not willing to pay the fees for the loan. If you run across a lender who will not provide you with a complete list of terms and all costs in writing, then you should quickly find a new lending resource. A lender who is not willing to provide this information is likely to have hidden fees and a hidden agenda when it comes to your loan.

For a very similar reason, if your lender is not willing to provide you with a complete copy of your documentation prior to signing the agreement, then there are almost certainly hidden fees or terms included that will work against you. Loans To Flip Houses in Arizona are complex documents and unless you are familiar with the terminology and the legal ramifications of the loan documents, then you need to have a legal professional review the contract before you sign it.

Less Than Helpful Lenders

Any lender who is not responsive or who is difficult to contact during the application process is very likely going to act in the same manner after you sign the loan agreement. If you feel that you are not getting the customer service that you deserve, it is better to end the process and begin to work with a different lender who better meets your needs.

Follow Your Gut

Selecting a lender who will provide you with Loans To Flip Houses in Arizona is a big decision. If at any time during the process, you begin to feel uneasy, pressured or ignored by a potential lender, then you need to sever the relationship. Ideally, you will find a lender and continue to work with him or her for many years to come and on many deals. So be sure that you find one who is reliable, professional and above all, one who is honest and clearly has the integrity that you desire in a business partner. Invest the time in selecting a good lender and you will undoubtedly save yourself money over the course of your real estate investing career.

                                                               Dennis Dahlber Broker Ri CEO Level 4 Funding LLC

Dennis Dahlberg

Broker/RI/CEO/MLO

Level 4 Funding LLC

Hard Money Lender

Hard Money Loans

Hard Money Loan

Arizona Tel:  (623) 582-4444

Texas Tel:      (512) 516-1177

Dennis@level4funding.com

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:  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.

© 2019 Level 4 Funding LLC. All Rights Reserved.

Copyright | Privacy Policy | *Terms & Conditions