Tag Archives: commercial hard money loan

Commercial Lending from the SBA

September 24, 2017Uncategorizedcommercial hard money lender, commercial hard money lenders, commercial hard money loan, commercial hard money loans, commercial lending, commercial lending texasbigdaddydennis

Commercial lending through the Small Business Administration has many advantages for your business. But you will want to be sure that you understand the guarantee fee and other loan fees.

Any time you are researching commercial lending options, you need to be fully aware of the entire fee structure of each lender to be certain that you are selection the best option to meet your needs and your budget. In most cases the SBA is not the lender, but they do offer the lender a guarantee on certain types of loans. The cost of the guarantee is then passed on to the borrower. But the benefits to this type of loan are the lower interest rate and the longer repayment term.

Normally the SBA will guarantee between 75% and 85% of your loan and that is the amount that they use to calculate the guarantee fee. A very short term loan of less than a year will have a rate of .25% for the guarantee while longer term loans can be calculated at a rate up to 3.75%. This process is in place for all SBA 7a loans. There are also some additional fees that can apply to a 7a loan as well as other loans offered through the SBA.

There is an origination fee that can range from .5% up to 3.5%. The percentage that you will pay is determined by the lender that you are using as well as the size of the loan that you have requested. You will also be paying a loan packaging fee. This is a service that is provided to you to help improve your chances for approval during the commercial lending application process. In most cases borrowers are not familiar with the process or the amount of documentation that is required for approval. The application package represents your first impression to the lender and is critical in a successful loan. The broker fees and service fees are fairly self-explanatory. These are similar to any loan that you would ever apply for and it covers mostly the administrative side of the process.

Understanding Closing Costs

Commercial lending closing cost tend to cover a more broad scope than you might think. These are the fees that pay for any appraisal that might be needed, determining the valuation of your business, an environmental report for any property that might be included in the deal, the title fee for the property and any legal fees. It is very important that an attorney review all of the loan documents prior to you signing them. This ensures that you are protected and that the documents are all legally binding to all parties involved.

When the Fees Are Paid

As you read through the list of fess that can be included in an SBA loan, you might begin to worry about the total cost and how you might be able to afford to pay the amount up front. But another benefit of working with the SBA for a loan is the fact that the guarantee fees and origination fees are rolled into your loan and paid over the term of the loan. The only fees that you must prepay are the appraisal fee, the business valuation fee and the environmental fee. The title fee, loan packaging fee and the attorney fees are normally paid at the closing of the loan.

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

Texas Commercial Lending Professionals To Deal With Cyber Threats In 2017

September 19, 2017Uncategorizedcommercial hard money lender, commercial hard money lenders, commercial hard money loan, commercial real estate, texas commercial lendingbigdaddydennis

Commercial real estate professionals are at greater risk for cyber attacks than ever before. Increase your company’s security by expanding your knowledge.

Cybercrime is here to say. This can be said with confidence because of how much money that businesses globally are spending to secure their digital assets. According to the latest Cybersecurity Market Report released by Cybersecurity Ventures, worldwide spending on cybersecurity products is expected to be greater than $1 trillion over the five years between 2017-2021.
Many companies in the Texas Commercial Lending industries that have already taken a proactive approach to securing their company and their client from digital intrusions. Others have taken a less diligent approach to proofing their operations against cyber threats, making these companies are among the most vulnerable. Regardless of what approach your company has taken toward cybersecurity, there’s always time to correct the course. These tips will help commercial real estate companies back on the right track.

1. Don’t Underestimate The Threat – One of the many reasons that commercial real estate professionals fall prey to cybercrime tactics is because they believe that their operation is of no interest to a hacker. Alternatively, they may believe that the investments they have already made are sufficient to protect them from attacks. This naive approach belies the interconnected nature of the industry. Even if one of your colleagues or industry partners is at risk, there’s a good chance your company is at risk as well.

2. Understand Where Cyberattacks Start – One of the most difficult parts of protecting a commercial real estate firm from digital threats is covering every angle of attack. Data breaches can occur because hackers take a hard look at a company and decide to dig in and overcome their firewalls. On the same token, data breaches can occur because an employee working remotely accidentally loses their login credential at a coffee shop. A malicious virus stored on a client’s computer systems may even transfer over by way of email or a shared digital document. There are so many points of entry that without a dedicated team of specialists, your company must simply accept a certain degree of vulnerability.

3. Take Care When Financing Smart Buildings – If your company plans on financing a commercial real estate asset or building one from the ground up, special care must be taken around the installation of “smart” or Internet-of-Things technology. These devices, meant to interconnect a variety of consumer products via streamlined app functionality, offer value in that they can potentially make a workplace more efficient. They also represent a critical cybersecurity risk, as most smart products lack the necessary encryptions necessary to safely link them to the company’s network.

Ignoring Cyber Threats Won’t Make Them Go Away

Don’t put off securing your company from digital threats. The Texas Commercial Lending industry is competitive enough without setbacks caused by malicious hackers. It’s best to assume your company is a target, even if you don’t understand what hacker would be targeting.

Protecting real estate investments from hackers is easier when your lender has your back.

Lenders who are familiar with the nuances of smart technology are savvy enough to know you’ll need extra help securing your state-of-art building when you finance. If relevant, be sure to bring up your concerns about cybersecurity directly at the negotiating table.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

A Closer Look At The Emergence of REITs In The Texas Commercial Lending Industry

September 18, 2017Uncategorizedcommercial hard money lender, commercial hard money loan, commercial lender, commercial loan, commercial mortgage, commercial real estate loan, texas commercial mortgagebigdaddydennis

REITs represent the next generation of big players in the Texas Commercial Lending industry. In the near future, these trusts are targeting opportunities in the industrial, multifamily and student housing sectors.

When buying stock from another company, your business diversifies its portfolio while creating opportunities for new revenue. These investments aren’t a sure thing, but the potential reward is well worth the risk. The same attitude has encouraged the rise of real estate investment trusts (REITs), private companies that specialize in purchasing and managing commercial property.
By investing in a REIT instead of directly purchasing real estate, investors can enjoy the perks of a strong market without having to deal with the hassle of actually buying, maintaining and selling real estate assets. It’s no wonder that the new approach to commercial financing has become so popular. For companies interested in acquiring commercial real estate assets, it is important to understand how the rise of REITs has affected the status quo.

● REITs stand out among growing field of non-bank lenders – Due to strict terms and excessive requirements, borrowers have been more willing than ever to accept an alternative to banks and traditional lenders. This demand has given rise to REITs, organizations that typically make it easier for their clients to receive capital and adopt a flexible repayment strategy, According to CoStar, REITs loaned out over $14 billion in the first half of 2017 alone, suggesting that their approach to financing has a broad audience. If REITs continue to increase their control of the market at this rocket pace, then it will only be a matter of time before they become true leaders in the industry.

● Industry sector piques interest of REIT investors – It’s interesting to see how REITs operate compared to other non-traditional lenders, who may concentrate on niche industries that banks may not be interested in. REITs, on the other hand, seem to be competing directly with other industry for the biggest slice of pie. According to the National Association of Real Estate Investment Trusts (NAREIT), most REITs are primarily focused on industrial projects. This is in line with most banks and traditional financial institutions.

● Many REITs already planning for the future – One of the clearest signs that REITs are here to stay is the fact that the industry’s leaders are already thinking about what’s next. A survey by National Real Estate Investor confirmed that most REITs are prioritizing taking advantage of opportunities in the rebounding industrial sector. In addition, REITs are also planning to zero in on medical office, multifamily and student housing investments in the next year as well. What does this mean for the rest of the industry? A more competitive pool of lenders is a boon for borrowers, and may actually create new opportunities for investors to score a big return.

Don’t Invest Without Understand Every Other Player In The Industry

It pays to know who you’re competing against when begin investing in commercial real estate. That’s why it’s so important to work with a lending professional who knows the local market (and its players) like the back of their hand.

Understanding where your company’s investments fit into the bigger Texas Commercial Lending market is a huge advantage.

Get the inside information you need when making commercial real estate investments by reaching out to experts in the area. Working with a knowledgeable private lender will provide your company with critical insights about the surrounding area.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Maximize Your Commercial Mortgage By Avoiding These Common Real Estate Investment Flubs

September 14, 2017Uncategorizedcommercial hard money lender, commercial hard money loan, commercial lender, commercial lending, commercial loan, commercial mortgage, commercial real estate loanbigdaddydennis

Real estate is full of promising opportunities. Avoid these rookie mistakes to ensure your company gets a full return on its commercial mortgage.

Once your business has developed a detailed, data-driven action plan, it’s time to pull the trigger on the company’s big commercial real estate move. It’s important to remember that small mistakes can greatly impact the end value of a major investment. The same goes for commercial real estate investments. If your company wants to get the full value back for a commercial mortgage, it pays to plan for common hurdles. The more prep work you do before hand, the greater the return on your group’s investment.

What’s the best way to make sure these little mistakes don’t cost you hundreds of thousands of dollars? Be informed and plan ahead. Don’t let the following common commercial real estate flubs chip away at the value of your investment.

● Don’t Assume Banks Have All The Answers – Traditional financial institutions hold a great wealth of information, but remember that they are also businesses competing for your dollar. Unless you have a pre-existing relationship with a bank, they are only obligated to tell you so much about the market and what types of commercial mortgages are available elsewhere. Furthermore, their risk-adverse nature can make banks less knowledge of niche or emerging industries.

● Avoid Investing On A Hunch – Going with your gut will serve you well in numerous business scenarios. A major decision concerning real estate investment is not one of them. Your company is much better off relying on data analytics and fresh impressions of recent deals. Having a detailed strategy in place also makes it easier to correct your approach if your project isn’t showing immediate results. Investing on a hunch puts your company back at square one if said investment doesn’t pay off immediately.

● Select Properties Only After Extensive Research – Where you invest deserves just as much thought as how you invest. To this end, your company must dedicate significant resources to evaluating and vetting a property before selecting it for development. Failure to do so puts your business at risk for managing a snowballing problems down the road. These types of systematic issues tend to develop when major details about a property are overlooked. Make sure specialized professionals look over every aspect of the property before making a decision.

● Maintain A Student Mentality – The best commercial real estate investors never stop learning. The property market is nothing if not dynamic. Those who assume the status quo’s best practices will keep working five or ten years from now have unrealistic expectations. That’s why it pays to keep learning about the market and stay abreast of recent trends even after you’ve committed capital to your investment.

Investing Your Commercial Mortgage With Expert Help Limits Your Company’s Risks

Need to get into the commercial real estate game sooner than later? There’s no substitute for experience. If your company doesn’t have that know-how internally, it pays to reach out to an practiced professional.

A vetted and capable lending professional can offer the helpful inside information you need to succeed.

Connect with a reliable private lender for access to capital and a better understanding of the market where your business is choosing to invest.

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

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 To Look For In A Redevelopment Project Before Taking Out A Commercial Loan

Location is vital when picking out a building for redevelopment, but that’s just the start. There are several factors to consider before your company is prepared to take out a commercial loans.

Innovative redevelopment projects remain the closest thing the commercial real estate industry has to a sure bet at the moment. It’s not surprising why these properties are so valuable, considering the old real estate adage that encourages investors to pick up the crummiest house in a nice neighborhood. When the location and fundamental are sound, all it should take is a few tactical investments and smart marketing to turn a struggling Class B property into a Class A asset.

That’s why so many companies, likely yours included, have mused the possibility of taking out a Commercial Loans to invest into an office, industrial or multifamily redevelopment project. Look for the following qualities when evaluating potential targets for investment. The more ideal the property you choose is for redevelopment, the more you stand to make back on your investment.

● Versatile Marketing Potential – The most suitable candidates for redevelopment are those properties that have the greatest potential for a wide variety of projects. An office building that could be sectioned off into multiple, smaller offices, for example, offers more flexibility than a single-floor industrial facility. Focus your investments on properties that give your business the most paths to success.

● History Of Income Generation – Chances are that if you are looking at a property for redevelopment, the building’s current income generation is not ideal. That being said, it pays to look into the history of the facility. Was there a time where the property was performing well? What kind of customers used to frequent the businesses that rented space the building? A once successful establishment is much easier to turn around than one that never attracted business in the first place.

● Established Traffic Flow – Location, as always, in extremely pertinent to real estate transactions. In the case of redevelopment, learn as much as you can about the businesses surrounding a potential property asset. Their customers make up the traffic flow that is already present near your investment. If your company’s redevelopment strategy targets these consumers, your company is already in a good position to get back the full value of its commercial loan.

● Removable External Fixtures – First impressions are extremely important, especially when it comes to getting individuals to take a second look at a struggling property. You want the building’s exterior to broadcast quality, innovation and class. The easier it is to provide a facelift, the more likely you are to make a big splash with your redevelopment project. Properties with removable external features are ideal for redevelopment because they can be quickly replaced and refreshed with modern, eye-catching accents.

Cost-Effective Improvements Allow You To Fully Leverage Your Commercial Loan

The more you understand the types of consumers that frequent the spaces near your investment property, the more you can tailor your improvements to their needs and expectations. Being able to narrow in your approach to improvements will help reduce costs.

Clever redevelopment projects promise serious return for savvy investors

Ready to invest in a prime redevelopment opportunity? Your business can get the capital it needs right now by working an experienced private lender.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

3 Tips For Getting Your Next Commercial Real Estate Loan Approved

September 14, 2017Uncategorizedcommercial hard money lender, commercial hard money loan, commercial lender, commercial lending, commercial loan, commercial mortgages, commercial real estate loanbigdaddydennis

It’s time to go back to the drawing board if your commercial real estate loan gets denied. These tips can help you turn that failure into a profitable success.

Your company is ambitious and looking to take advantage of a tempting real estate investment. The only problem? The business lacks the immediate capital and your most recent commercial real estate loan was denied. Don’t think that means your commercial real estate project is out of the picture. Your company has ample opportunity to rebound from this rejection. What’s the best way to proceed?

By understanding why your loan application was denied and identifying ways to change up your approach, your company is in a much better position to get an approval. Employ the following strategies to put the odds in your company’s favor:

1. Address Feedback From Previous Applications – Chances are that the lender that denied your application provided an explanation for why your loan wasn’t approved. Perhaps your company’s credit score was too low or the business’ credit history was not sufficiently diverse. Perhaps your company and the lender couldn’t agree to satisfactory terms. Either way, learning the lessons from the first application is critical toward getting the your next commercial real estate loan approved.

If your company is unable to effectively address these criticisms, then it’s important to develop a narrative explaining why these perceived weaknesses are irrelevant. Simply having a confident explanation for holes in your company’s loan application will improve your chances of getting approved.

2. Draft Multiple Promising Business Strategies – Regardless of why a lender reportedly denied your application, it almost always comes down to whether or not the lender was confident your company could successfully pay back the loan. With this in mind, it’s up to your business to do everything it can to convince a lender that they are likely to see a return on their investment. Business plans demonstrate to lenders that your company has defined path toward success.

Depending on other factors in your company’s credit history, this may not be sufficient. Devising multiple contingency plans, illustrating your ability to pay back the loan in multiple scenarios, may be enough to get your loan approved.

3. Consider A Private Commercial Lender – Instead of changing up your approach, why not just change up your lender? Traditional lending institutions like banks have plenty of capital to lend, but strict rules about who, how and when they lend it to borrowers. Working with a private lender promises more flexible options that better line up with your company’s timeline. Private hard money loans have their own advantages, so much so that it’s worth comparing your options even if you can get you loan approved by a traditional lender.

A Flexible Lender Will Help Your Company Create Success Through Real Estate

Start researching your lending options now if your company is preparing to make a major commercial real estate investment.

Don’t let your business miss out on an opportunity for lack of capital.

Local private hard money lenders are ready to facilitate your next commercial real estate investment. Reach out today to learn more about your options for rapid capital.

Technorati Tags: commercial loans,commercial lending,commercial mortgage

Deutsche Bank Gets Their Butts Nailed for $95 Million ……Is that a lot of Money?

August 16, 2017Uncategorizedcommercial hard money lender, commercial hard money lenders, commercial hard money loan, commercial lendersbigdaddydennis

The state of Maryland has reached a $95 million settlement with Deutsche Bank over claims of deception with their sale of residential mortgage-backed securities. Maryland Attorney General Brian Frosh announced the agreement earlier this month that includes a requirement that Deutsche Bank provides $80 million in relief to the state’s consumers. Municipal and local governments also stand to benefit from the deal as the agreement stipulates $15 million of the $95 million restitution going towards public investments.

Deutsche Bank is accused of providing misleading information to investors regarding securitization and collateralized debt offerings. All of the alleged turmoil ensued before the nation’s financial crisis that occurred nearly a decade ago. The Department of Justice accused Deutsche Bank of knowingly making false or misleading representations when soliciting to investors. Such fraud centered around the nature of mortgage loans that were issued between 2006 and 2007. The advances totaled in the billions and included private buyers as well as corporations, along with public entities such as city and county governments.

Deutsche Bank acknowledged its failure to provide investors with complete and accurate information, and thus agreed to a settlement that included relief to homeowners currently underwater because of the financial institution’s carelessness. The Department of Justice has mandated around $4.1 billion in aid going to such borrowers, with an $80 million portion of the most recent agreement set aside for consumers, accounting for some of the funding.

Mortgage forgiveness and forbearance are two of many ways that Deutsche Bank plans to make good with the public on the $95 million settlement. The financial institution also plans to implement low to moderate income lending along with affordable housing practices. Investing in the community as a whole will be another way that Deutsche Bank makes amends for its wrongdoing. The corporation has plans to contribute to housing stabilization for various cities and, as a result, help shore up the state of Maryland’s economy.

It seems that Deutsche Bank has had to answer up in recent months for some deceptive practices. The financial institution settled a federal mortgage probe in December 2016 in which it was ordered to pay a civil penalty totaling $3.1 billion. The final price tag for the investigation was $7.2 billion, which was a reduction from the initial $14 billion that the government initially proposed. The $4.1 billion relief expense imposed by the Department of Justice resulted from this probe and may have contributed to Deutsche Bank’s legal costs, which accounted for $2 billion in losses on the financial institution’s fourth quarter report.

Deutsche Bank was also found liable in a silver manipulation lawsuit in October 2016, and ordered to pay $38 million in damages. The financial institution is accused of employing manipulative device claims along with a myriad of other offenses that it was unable to refute effectively. The original class action lawsuit for this matter was filed in July 2014 and included other banks, which subsequently cleared their names and avoided substantial penalties over the alleged deceptive practices.

The most recent settlement between Deutsche Bank and the state of Maryland adds to the company’s total in legal bills and overall liabilities.

Only time will tell if more cases concerning Deutsche Bank result in losses, placing, even more pressure on the Frankfurt-based financial services company to revamp their policies.

Posted By Amy Martinez | Geraci Law Firm

Dennis Notes:

I remember my first real estate class with Skip at Westford Collage of Real Estate years ago, and one of the first things he said was ‘full disclosure’. Never hide information about the deal. Today I’m the mortgage business (private hard money), I remember this comment. But I’m always surprised when I talk to borrowers who try to ‘hide pertinent facts’ about the deal. It’s a feeling that what you don’t know is none of our business. I partially get concerned when I ask borrowers questions, and three is a reluctance in telling the true story about the deal. when I look at those trouble loans that went off the deep end, there always was some shenanigans occurring by the borrower. Not telling the true story and hiding information about the transaction only to be discovered when the deal goes to foreclosure. Of course you know when the deal goes off the tracks, the borrower always wants to blame someone else, like the mortgage company or you the sales agent. My recommendation is to avoid these sketchy individuals that are trying to do some sneaky transactions. Usually my instincts tell me what’s going on, but sometimes they slip thru and cause problems. So beware, always disclose and hopefully your client will fully disclosed to you also.

Technorati Tags: private lenders,home flippers,hard money loan

Private Money Lenders VS. Commercial Hard Money Lenders

July 21, 2016Uncategorizedcommercial hard money, commercial hard money lender, commercial hard money lenders, commercial hard money loan, commercial hard money loans, commercial loan, commercial loansbigdaddydennis

We know that commercial hard money lenders aren’t banks or other traditional institutions that are in the business of loans, but are they private money lenders? Moreover, if hard money lenders are not private money lenders, then you may just be asking yourself, well who are they?

There are often so many interchangeable terms when it comes to the world of commercial lending that it is easy to forget that not all interchangeable terms always mean the same thing. For instance, it is not uncommon to hear the phrase private money lenders and naturally think non-bank lenders. Moreover, when people think of commercial hard money lenders, they are also inclined to think non-bank lenders. Are you confused yet? Well, it is okay if you are because you are definitely not alone.

The reality is both private money lenders and commercial hard money lenders are traditionally not banks. But, that doesn’t mean that both of these non-bank lenders are the same nor do they offer the same loan options. So, now that that’s a little clearer, let’s go over just how these two particular commercial money lenders are different.

For starters, you will learn very quickly that hard money loans meet a very specific need. For example, let’s say you are a house flipper or a commercial developer and you need quick, short-term financing without a lot of red tape. These two instances are generally when you want a hard money loan. In fact, these instances really make up the bulk of hard money loans. Moreover, it is because of this fact that hard money lenders appeal to a certain niche market. Private money lenders, on the other hand, are more relationship-based and offer loans for real estate transactions—plain and simple. In other words, there really are not any specific scenarios where you absolutely need to contact a private money lender to provide financing rather private money lenders are basically just another non-bank financing outlet.

Understand the Differences

To truly understand the differences between these two money lenders, you have to understand how they each operate. For instance, private money lenders lend short-term financing at a premium based on a combination factors such as the borrowers background, the quality of securing property and likelihood of repayment. Hard money lenders offer short-term financing at a much higher premium based upon securing asset value. Thus, the real difference between these lenders is not only in how they operate (agenda, post-closing flexibility, etc.) but also what they focus on (philosophy, property, and location).

Things to consider when choosing Between the Two

Ultimately, it is clear that private money lenders and hard money lenders are different in a lot of ways. But, they both offer the required, creativity (example: loans with prepaid interests), simplicity (not regulated by banking policies) and quick turnaround time i.e. quick cash that most commercial borrowers need. Nevertheless, now you can say with certainty that you know the difference between these two lenders, which in the long run should make it much easy to decide which particular kind of money lender is right for you.

Dennis Dahlberg

Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel: (623) 582-4444

Texas Tel: (512) 516-1177

Dennis@level4funding.com

www.Level4Funding.com

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

Commercial Hard Money Lenders: How To Get A Loan With Rotten Credit

July 7, 2016Uncategorizedcommercial hard money lender, commercial hard money lenders, commercial hard money loan, commercial mortgagebigdaddydennis

Rotten Credit Keeping You From Getting A Loan? Try Applying
With Commercial Hard Money Lenders!

Poor credit can prevent many from even applying for a
commercial loan, but it doesn’t need to. There is an option that is still
available through commercial hard moneylenders.

People make mistakes with money. It happens. You don’t mean
to (or maybe you did). Sometimes life just throws too many problems at you, and
you couldn’t see another way out—or maybe you and your credit card were the
life of the party in college.

So you developed bad credit while you were in college or
your younger years. Now you are a responsible, hard-working adult that just
wants to open your own business and be your own boss. It’s the American dream.
Too bad your rotten credit rating is keeping you from getting approved for a
traditional commercial loan.

But there is a solution to your problem—commercial hard money lenders!

What Is A Commercial Hard Money Lender?

Don’t worry–you are not dealing with your local loan shark.
So you don’t have to worry about someone trying to take out your kneecaps if
you miss a couple of payments. No, commercial hard money lenders are legitimate, private individuals or companies that
loan money to people and businesses with rotten credit who can’t get approved
for a traditional loan.

Loans are secured by commercial property and will have
higher interest rates than conventional loans. Since there is more risk involved
for lenders, they can charge higher interest rates. It is not unusual to see a
lender charge 11-13 percent and three points.

If you want to go into business for yourself, it is a cost
you have no choice but to accept. You may hesitate because you don’t want to
risk having your business foreclosed on, but lenders don’t want to foreclose on
your property if they can at all avoid it. When they do, it is not unusual for
them to lose money—and no one wants to lose money.

Beware The Fees And the Dreaded Balloon Payment!

Commercial hard money lenders are not going to be willing to wait 10-30 years to get their money
back. They give short term loans; typically for a year, but maybe as long as
three years. With the interest rates being as high as they are, if you can, it
is not a bad idea to try and pay the loan off early—that is, unless there is an
exit fee or prepayment penalty.

While it may sound strange to be penalized for paying a loan
off early, lenders make money when you pay interest. If you pay the loan off
early, you don’t pay as much interest. So to recoup this loss, some will charge
a prepayment or early payment penalty.

Some will even charge exit fees whether you are paying the
loan off early, late, or on time. This way lenders make a little more money off
of you.

You will want to know if your loan has a balloon payment at
the end. Where these can sting is if you are paying your loan off late, like
many hard money loans often are. So along with the balloon payment you get
stuck with a hefty late fee making it even more difficult to get the loan paid
off.

Dennis Dahlberg Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis@level4funding.com
www.Level4Funding.com

111 Congress Ave |Austin | Texas | 78701

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.

Commercial Bridge Loan: How To Evaluate Risks vs. Benefits

July 7, 2016Uncategorizedcommercial bridge loan, commercial bridge loans, commercial hard money lender, commercial hard money lenders, commercial hard money loan, commercial hard money loansbigdaddydennis

Any form of financing
is going to have some advantages and drawbacks to using it. Commercial bridge loans—like any other
loan–have both.

In a perfect world, there are many things that business
owners would never have to worry over. They would never have cash flow issues.
They wouldn’t have to wait for their long-term financing to come through. If
they needed to make any repairs or changed before they could get approved for a
long-term loan, they would be inexpensive and easy to fix.

The list could go on and on, but the sad reality is that
business owners often find themselves in need of cash for one reason or another
before they can receive approval for their primary loan. A commercial bridge loan can help them bridge the time gap till the
long-term loan is approved.

However, just like anything else in finance, a commercial bridge loan comes with
drawbacks as well as benefits. It is important to know what they are ahead of
time.

Benefits To Applying For A Commercial Bridge Loan

Of course, the biggest benefit is that your business gets a
much-needed cash infusion, but there are other benefits to getting it through a commercial bridge loan.

One of the more significant benefits is the very nature of
the loan–it’s short term. Short term means you have less time to pay off a
loan and can only break the payments down so much, but it also means you pay
less interest. With longer term loans there will be more of a chance you and
your business fall on some hard times. If you struggle to recover and miss a
few payments (or default) getting another loan in the future could be harder.

To keep repayment from being an issue, commercial bridge loans are often structured to be paid back when
your long-term loan comes through. Making your payments will, of course,
improve your credit rating which will make it easier for you to get your next
loan.

Drawbacks Associated With Commercial Bridge Loans

One of the biggest drawback to commercial bridge loans is the most obvious. Since it is a
short-term loan, the payments will be larger. Larger payments are more
challenging to make, and since the term is shorter, lenders are often less
likely to be flexible with payment arrangements. Instead, they will probably be
more likely to tack on late fees and penalties making it even harder to make
your payments.

Of course, you can get around payment issues by structuring
the loan so you can pay it off after you receive our long term one. However,
the longer you take to pay it off, the more interest accrues. Depending on the
size of the loan, the interest can be significant.

The biggest potential drawback is the purpose of the loan
itself. It is meant as a short term solution to help you cover expenses as you
wait for your long-term loan to be approved. What if it gets turned down? What
if, like many people were faced with during the housing crisis, the institution
you are trying to get your long term loan through fails?

You still have to make your payments on time. Should you
struggle with doing so, your credit rating may be adversely affected which will
make it harder to get approved the next time you apply.

Dennis Dahlberg Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis@level4funding.com
www.Level4Funding.com

111 Congress Ave |Austin | Texas | 78701

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.

Level 4 Funding Private Hard Money

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Tag Archives: commercial hard money loan

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Commercial real estate professionals are at greater risk for cyber attacks than ever before. Increase your company’s security by expanding your knowledge.

Ignoring Cyber Threats Won’t Make Them Go Away

Don’t put off securing your company from digital threats. The Texas Commercial Lending industry is competitive enough without setbacks caused by malicious hackers. It’s best to assume your company is a target, even if you don’t understand what hacker would be targeting.

Protecting real estate investments from hackers is easier when your lender has your back.

REITs represent the next generation of big players in the Texas Commercial Lending industry. In the near future, these trusts are targeting opportunities in the industrial, multifamily and student housing sectors.

Don’t Invest Without Understand Every Other Player In The Industry

Understanding where your company’s investments fit into the bigger Texas Commercial Lending market is a huge advantage.

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A vetted and capable lending professional can offer the helpful inside information you need to succeed.

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