Tag Archives: commercial hard money lenders

Why Real Estate Investors Use Commercial Hard Money Loans

2page_img4-bigSuccessful real estate investors understand that leveraging other people’s money is the way to build your own wealth. Commercial hard money loans are a popular tool to accomplish this process.

Savvy real estate investors know that using other people’s money to fund great deals is the fastest way to grow your personal wealth. This method allows investors to purchase much more expensive properties which increases their profit on each transaction. And in return it also provides the lender with a nice return on investment.

Commercial hard money loans are not like traditional loans in that they are not a one size fits all loan. In most cases the dollar amount of the loan and the terms are customized to meet the needs of each transaction. This means that a first time flipper can get a loan that offers the dollar amount and the time frame that is needed just as a commercial investor can for a much larger deal. This flexibility makes commercial hard money loans very appealing to all real estate investors.

Another benefit of commercial hard money loans is that approval is based less on the borrowers credit score and more on the merits or the property or deal being made. This opens up the commercial real estate industry to investors who might not have perfect credit or who already are carrying a few mortgages on other properties. The final decision on getting a loan rests on the merits of the property that is being purchased and used as collateral.

Personal Attention Has It’s Benefits

Borrowers also like to use hard money lenders because they are working with a person and not a huge lending institution or bank. Not only does this make the process much faster but it also can offer a much more personal and tailored transaction. You are not calling a number only to get passed from one department to the next to get a question answered or check on the status of your loan. You work with the person whose money you are borrowing and you can make direct contact to resolve an issue or answer a question.

Nontraditional Can Be Better

Hard money loans are not the best solution for every commercial real estate transaction but they are a unique solution for many of them. The terms of the loan can meet each borrowers needs and can be processed in a fraction of the time that is required for a traditional loan. The cost for this custom service is more than the fees for a traditional loan but are worth it if you were struggling to get financed at a bank. And in the case of a real estate investor who might be in process on several deals, there is not the high risk issue on a hard money loan as there would be on a traditional loan. The merit of the individual deal is what carries the weight with a hard money lender. Hard money loans are favored by real estate investors because it is a means to increase their business and their profits.

Dennis-Dahlberg-Mortgage-Broker-1_th

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701
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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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

4 Benefits of Commercial Hard Money Lenders

1page_img3As a real estate investor you understand the importance of having a relationship with a lender and you also know that even your regular lender will only grant a loan under certain conditions. The solution to the fickle world of commercial lending is to cultivate relationships with commercial hard money lenders.

Having a relationship with a bank that you trust is important, but there are no friends in the banking world. Every deal must go through the same arduous process of applications, verification and a loan board for approval. You can be submitting your first application or your hundred and first and it will still need to go through the same motions. But commercial hard money lenders are a great option to avoid the long traditional process which is muddled by numerous qualifications and criteria. It is clear that the benefits far outweigh the added costs charged by commercial hard money lenders.

Hard money lenders are most often individuals or a small group of people who are in the business of loaning their own money to borrowers. This means that they are in control of the process and are not required to follow the long application and approval process that traditional lenders are mired down with. Hard money lenders are less interested in your credit history and credit score and more interested in the value and merit of the deal that you are working on. They understand that if you default on the loan then they are going to need to foreclose on the property being used as collateral and sell it to recover their money. So the value of the collateral is their primary concern.

In addition, commercial hard money lenders offer a much more expedient process when processing a request for a loan. It makes sense that with fewer people and departments involved the process can move more smoothly and quickly. This is very helpful to a real estate investor who has found a great deal and needs to act quickly before someone else closes on the property.

A Professional Resource

Another benefit of working with a hard money lender is their knowledge of the commercial real estate industry. Although most are not in the business themselves, they are very familiar with the market and have educated themselves to allow for good decisions when considering loan requests that they receive. They are also knowledgeable about the state laws surrounding commercial real estate as that can have an impact on their part of the loan. In short, a hard money lender has the knowledge of the industry but is in no way a competitor of yours and should be considered a good resource and reliable ally.

More Deals Means More Money and Profit

Forging a strong relationship with a hard money lender will ensure that you have a reliable resource whenever you need a loan for a property. With less stringent requirements the lender is more likely to appreciate your request to carry multiple loans and know that more loans equals more money for both of you.

Dennis-Dahlberg-Mortgage-Broker-1_th

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701
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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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Why Commercial Hard Money Loans are favored by Successful Real Estate Investors

1aupload8.5x11bugCommercial hard money loans are a tool that every real estate investor should be aware of. There are many advantages to financing with a hard money loan.

Real estate investing is an ultra-competitive business and any advantage that an investor can gain over the competition is greatly appreciated. Using commercial hard money loans to finance real estate purchases offers an investor some surprising benefits when making a purchase.

Fast loan approval and fast funding are two huge benefits of commercial hard money loans. But those two factors can influence other aspects of a commercial real estate purchase. The hard money application process is much faster and more efficient so that takes a lot of the stress off of the borrower during the negotiation for a property. They know that they will not be trying to compile a huge number of documents to submit to their lender. In addition, sellers look very favorably on an offer which includes commercial hard money funding. This is because of the fast approval and funding of the loans. It is also because banks have been known to pull financing from a borrower late in the application process and ruin many deals. And sellers are always happy to learn that they are going to be paid in all cash because the buyer is using a hard money lender. This can give the buyer a little bit more negotiating power to win a deal and get a great price.

Commercial real estate investors face many challenges when they are forced to use only traditional lenders. One fact is that you need to have great credit to get a large loan from a bank. But commercial hard money loans are much less dependent on credit scores and credit history so they are much easier to obtain. The main criteria for approval is that the collateral property hold a value greater than the loan. So investors rely much more on the value and quality of the property that they are purchasing and less on their personal credit. Hard money lenders are also more accepting of an investor who has just recently purchased another property and might be holding several commercial loans at the same time. Hard money lenders understand that making more purchases is the best way for an investor to make more money.

Flexibility is Key

One of the greatest advantages of a hard money loan for a real estate investor is that the lenders tend to be very flexible. This can be seen in the less restrictive criteria to qualify for the loans as well as the size and other terms of the loans. This flexibility allows the real estate investors to be more creative and make more investments.

A Profitable Partnership

When you are working with a bank on a loan application you never know who you will talk to or if they will know you. You might apply for dozens of loans from a bank and have a new person to work with on each application. But when you establish a relationship with a hard money lender, you know who you will be working with on every deal. Having a hard money lender to rely on and work with on a regular basis will provide a real estate investor with a distinct advantage over other buyers.

Dennis-Dahlberg-Mortgage-Broker-1_th

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701
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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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Getting the Best Rate on Commercial Mortgages

!cid_87129CA4-8997-4497-93EA-0E8446CC772AWhen you are comparing commercial mortgages you want to verify that you are getting the best rate possible. And there are a few tips that you can keep in mind that lenders are looking for when determining loan rates.

When you are shopping for commercial mortgages there are many terms that you will need to negotiate with the lender. But there are also some key pieces of information that the lender will be taking into consideration when they are determining the interest rate that they will offer you. Knowing what the lender is looking for and what the lender considers a good property can help you to secure a better interest rate and possibly even help you in negotiating the other terms of the loan.

One of the first things that a lender is going to look at is the applicant’s credit rating. The lender wants to be sure that you have good credit and also a strong net worth. These two factors are a good indication of how you would be able to withstand a short interruption in your cash flow. The lender is also interested in your work history and how much management experience you have. They need to know that your business is in good hand, will be managed successfully and will be able to make the payments of this long term commitment.

Lenders are also looking at the property that you want to purchase. Commercial mortgages are often secured by the property being purchased, it is the collateral, and the lender wants to be sure that the property will remain valuable. With this in mind, the lender is interested in the location of the property and that it is not too rural. This can make the property value more volatile and its value could become questionable. They are also interested in the history of the building, any past tenant information and if there are any current leases for any portions of the property.

Understand the Concept of Collateral

Lenders never want to think that they are funding poor applicants for commercial mortgages. But they do have a system in place to protect themselves in case there is an unforeseen issue. Businesses can fail for many reasons and some of them are not predictable. So the lender will require that you offer collateral for the loan. This is normally the property that you are purchasing. And in the event that you default on the loan then the bank will foreclose on the property and sell it to recover their investment. This is the reason that a lender wants to verify the actual value of a property that you are purchasing.

Understand All of the Criteria

Understanding all of the main criteria that a lender is interested in to determine your creditworthiness is very helpful. It allows you to create a packet of information to submit with your application demonstrating all of the qualities that the lender favors as well as showing your financial stability. Meeting all of these criteria will make you a more favorable candidate and get you a better rate on your loan.

Dennis-Dahlberg-Mortgage-Broker-1_th

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701
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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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

How Can I Minimize My Risk With Commercial Hard Money Loans

4page_img2-bigEven though they are easier to acquire than traditional loans and often have a much quicker processing time, there are a number of risks that come with commercial hard money loans. However, that does not mean that these loans are not good options if you can find ways to minimize risks.

It is no secret that real estate investing and property management are just as risky, if not more so, than any other financial adventure. Some might assume that, because it involves physical properties, there is less fluctuation and more stability. Especially with commercial hard money loans there is an inherent risk of a property being turned into a revenue generating source before the balloon payment of the loan becomes due.

But risks can be managed. They cannot be eliminated, especially if they are based on factors beyond the control of the borrower, but they can be known and accounted for. In fact, if anyone tells you that you can fully eliminate the risks of real estate investing with commercial hard money loans, you should probably run the other way. If that were possible, everyone would be doing it and there would be no opportunity in it.

One of the first things that you can do to minimize risk is to be realistic about performance projections. Many borrowers will give projections based on full occupancy, with rent always being paid, and minimal expense for repairs. But what happens if the property is not filled with tenants? What happens if rental rates fall instead of increasing? While it is not bad planning to anticipate what things will look like financially if all goes as you wish, it is also irresponsible to assume that this is the only possible outcome.

Another aspect of real estate investing that many borrowers fail to take into consideration and that leads to greater risk, is the competition. Properties do not stand alone and to treat them as such will only set you up for failure. It is very important to analyze what is happening with similar properties nearby. This is especially critical with commercial hard money loans, as the borrower does not have time to ride out the swings of a market. If real estate prices are continuously dropping at a time when you are trying to turn a property, it might end up costing you more than you profit.

Attempting to do everything yourself is another liability that many borrowers don’t take into consideration. Especially if this is your first time dealing with commercial real estate, it is incredibly important to get the advice and input of others, as well as capitalizing on their expertise. Doing so will greatly reduce the chance of a mistake being made.

What is the single greatest factor in decreasing risk with commercial hard money loans?

There is so much that is out of your direct control, but being thorough is something that you can always do. The more that you think things through and plan for how to handle unforeseen problems, the less likely you are to be caught completely unprepared. When it comes to commercial hard money loans, you can never have too many contingency plans.

Dennis-Dahlberg-Mortgage-Broker-1_th

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701
clip_image002clip_image004clip_image006clip_image008

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Commercial Real Estate Financing: Is There Anyway To Speed Up The Process?

approved for hard money loanIt is no secret that commercial real estate financing takes time, sometimes a lot of time. You may feel helpless, as a borrower, after you sign on the dotted line of your application and find yourself just sitting around waiting, but there are some things that can be done beforehand to make the process go as quickly as possible.

Getting to the point of signing on the dotted line with commercial real estate financing is a flurry of activity. Negotiating, contacting lenders, getting the paperwork in line and making sure that you are staying on top of the terminology are all things that take a great deal of time. But once you sign, the process (at least from the point of view of the borrower) comes to a halt and you must just sit and wait. But if you properly prepare, you might end up having to wait less than other borrowers.

One thing that you can do to make sure that your commercial real estate financing application is not ignored is to quickly and thoroughly complete the forms that the lender gives you. It might seem like common sense, but this is a mistake that many borrowers make and will help you to stand out. What lender is going to want to work quickly for you if you do not do the same for them? By showing the lender, through your actions, that you are willing to work just as hard as they are, you are going to increase your chances of them working quickly on your loan application. This will greatly speed up the process for you.

It is absolutely critical that all of the forms that your lender will give to you be filled out as completely as you can possibly do them. Many commercial real estate financing forms ask for a tremendous amount of detail. Do not ignore this. Even if it feels like you are repeating what is already in your documentation. Having this done before the third-party appraisal of the property comes in will keep your loan at the top of the que for the lender and underwriter, but if you wait, and the appraisal comes in without your paperwork, you will quickly find your loan at the bottom of the priority list.

Another tactic that will help leave a good impression and make a lender want to work harder for your loan is to simply follow their rules. Again, it might seem like common sense, but many borrowers will try to argue about the different processes that lenders use. There is no point in doing so and the only outcome is going to be making the lender frustrated with you and not wanting to work as hard.

Is there anything that I can do while my commercial real estate financing application is being processed?

There is actually very little that you can do, outside of waiting. If you have properly prepared and have been responsive to your lender quickly and with attention to detail, you will likely get immediate attention. The one thing that you can do is to continue to be responsive. If your lender asks for further documentation or for other information about the property, get that information to them quickly. The more you drag your feet, the more your lender is likely to move on to another project. The key to commercial real estate financing is to be responsive and be thorough.

Dennis-Dahlberg-Mortgage-Broker-1_th

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701
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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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

What Commercial Hard Money Lenders Want You To Know

4page_img4Hard Money has gotten a bad reputation amongst commercial lending circles due to the fact that they have lower standards and higher default rates. Yet, for borrowers who do not have the time for a lengthy loan process or might have had damage to their credit, these loans and commercial hard money lenders offer an opportunity to increase their revenue stream through commercial properties.

One of the nice things about hard money loans is that they are very flexible in the type of property that they can be applied for. This means that they are often the go to loan for virtually any purchase or project, if the borrower is looking for a quick turn around and can plan for an influx of cash flow with the loan to propel them forward. Commercial hard money lenders are always looking for opportunities to capitalize on excellent real estate properties.

Now that being said, there is actually one type of property that hard money cannot be used for: residential properties that are occupied by the owner. The reason for this is that there are many more regulations surrounding such a transaction and the added complication is not worth it to commercial hard money lenders.

When, then, are hard money loans a good option over traditional channels? One type of property that is a great suit for a hard money loan is a property that the borrower is intending to quickly fix up and turn around to sell. In this type of scenario, a hard money loan is excellent because the property will be improved and sold before the balloon payment of the loan becomes due. By doing this effectively, the borrower is essentially turning a profit with someone else’s money. Granted, the borrower will be paying the interest on the loan, but that will be minimal compared to the profit potential. There is inherent risk in this type of a venture, however, as there is no guarantee of a sale. To minimize their risk in these cases, commercial hard money lenders will use the property itself as security and will often occupy the first lien slot in case of default.

One of the greatest strengths of hard money loans is the speed at which they can be acquired. While a traditional lender can take a up to 6 weeks to get a loan funded (or longer, in some cases), a hard money loan happens in a matter of days. For projects that are time sensitive, this is a huge advantage, especially if the property that the borrower is pursuing has multiple bidders who are interested.

What is one thing that commercial hard money lenders wished that borrowers knew?

The one thing that many borrowers do not seem to understand about hard money loans is that the biggest factor determining the amount of the loan and the terms that will be offered is the property. Both the value of the property and the amount of equity that the borrower will have invested in it. Second to this is the plan for how the loan will be used for the property. If a borrower can show a solid plan for how they will increase revenue stream (and a lender hears this as being easily able to pay back the loan), it will be much easier to get approved. Commercial hard money lenders can be an excellent option for savvy real estate investors.

Dennis-Dahlberg-Mortgage-Broker-1_th

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701
clip_image002clip_image004clip_image006clip_image008

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Strategies For Negotiating With Commercial Lenders

3page_img1-bigIn order to get the best rates and terms for your commercial loan, you are going to have to negotiate with commercial lenders. However, there are strategies that you can use to enhance your chances of successfully getting the terms that you want.

If you are like most borrowers, you might feel like you are at a disadvantage when it comes to dealing with commercial lenders. They know more about the process and they have something that you want. But this does not necessarily give them all of the power. In fact, you, as a borrower, do actually have power to wield in negotiations with lenders.

One of the biggest strategies that you have as a borrower is your ability to walk away from a lender. It might not always seem like it, but they want your loan. It is the way that they make money. Even though you are coming to them for the loan, commercial lenders only get paid on loans that are actually underwritten and taken, not on inquiries. This gives the borrower a great deal of power.

The best way to use this power is to play different lenders off against each other. Rather than directly negotiating with a lender, get them to offer better terms by letting them know that you have other options that are better. Commercial lenders are not going to drop their rates and terms easily if they know that they are your only option. This would only cost them money. But, if they might lose your business if they do not adjust to your needs to keep it, they are far more likely to drop their rates without you having to do any negotiating whatsoever.

Another strategy is to front end the majority of your negotiations. Once the application process has started, it is very difficult for a borrower to find any leverage to have anything in the deal changed. But before you sign on that dotted line, the lender does not know if you are going to sign or walk away from the deal. This, again, give you the leverage that you need to make sure that your critical issues are addressed properly by the lender.

These sound like great strategies for negotiating with commercial lenders, so what could possibly go wrong?

Now, this does not mean that you should be terribly aggressive about this tactic. Doing so in the incorrect manner might backfire. So, it is okay to play lenders against each other, but do not go overboard with it. Threatening and being combative is not going to win you any battles in this, and might end up burning you tremendously.

And when it comes to negotiating before you sign the application, make sure that you limit your demands to what is actually critical to you. Decide what this is going in to the negotiation and do not overreach. If you have too many demands, you are likely to upset the lender and working with you is going to look like more of a hassle than it is worth. So make critical demands before you sign that dotted line, but convey to the lender that you are detail oriented and not overreaching.

Dennis-Dahlberg-Mortgage-Broker-1_th

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701
clip_image002clip_image004clip_image006clip_image008

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

What Commercial Hard Money Lenders Don’t Want You To Know

4page_img5-bigxThe process to apply for a loan in the commercial real estate industry can be confusing, even on the best of days. Lenders are often not helpful, simply because they do not have the time. They want to move on to a loan that is going to bring them a larger paycheck. Here are some of the things that they don’t want you to know about commercial hard money lenders.

In the minds of many, hard money lenders are the loan sharks of the commercial real estate industry. And they do little to dissuade this opinion. It makes sense. If coming to them makes a borrower feel like they are begging, or asking a favor, then they are the ones who can dictate the terms of the loan, even if it is a forgone conclusion that a borrower is going to be accepted by a commercial hard money lender.

But how can you, as the borrower, can outmaneuver them to make the situation work more in your favor? Well here are a couple of tactics that you might want to try when moving forward with a hard money lender. Obviously there is no guarantee that this will bring you lower rates and better terms, but it is worth a shot, isn’t it?

The first thing to realize is that not all commercial hard money lenders are sharks. Many of them are professionals who are simply trying to feed their family. However, all of them benefit from the stereotype of being difficult to deal with. What you must realize as a borrower is that a commercial lenders most valuable asset is time. If you are wasting it, you will get nowhere with them. The thing that you need to establish immediately is that your loan is going to be worth their time.

The second thing that you must realize about commercial hard money lenders is that they don’t expect anything from you. They will not be disappointed if you are disorganized, they just won’t work with you. They won’t complain and they won’t make demands, they will simply look elsewhere for their paycheck. So the best thing that you can do is to be organized, be on time, think things through and anticipate their needs. If you were a lender, what would you like to know?

Finally, you must understand that they actually want you to succeed. If you are a successful loan for them, not only do you get the funding that you desire, but they also get a nice commission. They are not your enemy, they simply want to make sure that you are worth their time.

So how do I get commercial hard money lenders to work with me?

As a potential borrower, the best possible thing that you can do is to take away all of the excuses to not work with you. Don’t be a waste of their time, be prepared with your documentation and be actively involved. The less time that they have to spend attending to your needs, the more time they can spend pursuing other loans and the happier they will be. Commercial hard money lenders want you to be an asset to them, not a burden. Anything you can do to reinforce this idea is only going to increase your chances of success.

Dennis-Dahlberg-Mortgage-Broker-1_th

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701
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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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Getting Started In Real Estate: What You Need To Know About Commercial Hard Money Loans

fast money hard money at level 4 fundingSecuring the funds to move forward with a commercial property purchase can be the biggest hurdle in real estate investing. This is especially true if a borrower is new to the market and has less than stellar credit. Commercial hard money loans offer an opportunity for borrowers that might otherwise not be able to secure a loan.

The first thing to understand about a non-traditional loan is the funding source. When a borrower is granted money from a hard money lender, they are not receiving the funds from a bank. The funds come directly from a private lender or from a private lending group. While commercial hard money loans do fall under certain regulatory agencies, they are not regulated in the same way as banks. This is what allows them to be able to be quicker in the processes, but also at a higher rate.

The terms of a commercial hard money loan are also typically very short. Again, this is very different than a traditional loan, where the terms could end up being as long as 20 -25 years. For most hard money loans, a year is a typical period of repayment, although some can last up to 5 years. The point of these loans, though, is a quick turnaround for the investor and a fast influx of cash for the borrower. Repayment of the loan is negotiable, with one option being to only make payments on the interest during the term of the loan, followed by a balloon payment at the end of the term.

The top concern for a lender of commercial hard money loans is the value of the property in question. This is how the lender determines the size of the loan that they are willing to grant. It is important to note, that if the borrower has multiple properties, they can use the value of one of their other properties to secure the loan, but this also puts that property at risk in case of default. So while a borrower might be able to receive a higher loan amount by doing this, it comes with a great deal of risk.

Because of the focus on the value of the property and the security it provides in case of default by the borrower, hard money lenders are not as concerned about the credit of the borrower. They know that if something were to happen and the borrower were to default that the loan will be repaid out of the foreclosure of the property. The loan is based on equity rather than credit, which is why many borrowers who are unable to obtain a traditional commercial loan often turn to hard money as an option.

Commercial Hard Money Loans sound risky. Is there anything I can do to minimize that risk?

The best thing that you can do as a borrower is to not get in over your head. Hard money is not risky if you have a plan and know how you are going to pay it back. While many borrowers have abused hard money, there are also plenty of examples of borrowers who have used the quick influx of cash to completely turn their businesses around.

Dennis-Dahlberg-Mortgage-Broker-1_th

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC  Private Hard Money Lender
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701
clip_image002clip_image004clip_image006clip_image008

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.

Technorati Tags: commercial loans,commercial lending,commercial mortgage