are
they? What is it? How can i send some? Is it beneficial? Let me share with you
some
of the basic principals about money lenders. First of all, lets determine
what
the term "license money" means. When cash is discussed between
investors, it
is
considered to either be "soft" or "license". Typically soft
money is easier to qualify
for
and the terms are plastic. Money, on the other license, is only the opposite.
It
is so much more restrictive. Not in that it's more durable to obtain, but the
terms
are
just specific plus much more strict. They have to be, because most money
comes
from common everyday people with a great deal of money on license. This is why
money
is also termed as "private money". The cash used for investment
purposes
comes from public, just like you and I, not a typical lending institution.
So
their first priority is to protect their investment finance. This is why the
terms
have
to be so strict. If it were you cash, you would want the same.
So
what are some of the term "license money lenders"? Observably it
just
because of the offer or property at license. They would only lend up to a
certain
percentage of the fair monatary amount of the possessions, that way in the
event of default, the money lender would profit handsomely if they had to
exclude or
sell
to an end buyer. Now, you will discover that many license money lenders, if
they want
to
secure business, require more than just equity to qualify. This is because the
laws
now are constructive for customers. Customer protection laws, time consuming
and
expensive court processes, and so on have obligated some money lenders
to
become even harsher when applying for a loan.
It
is good to know what the terms are when dealing with a hard money
lender
so you can find the one which will fit your needs. Let us cover some of the
terms
you can expect to see. Typically they will only loan you up to 70% ARV. This
means that a License Money Lender can
loan you up to
70%
of what the house is worth in revitalize condition. When you find a home worth
$45,000
in the condition it's in, and needs $20,000 in repair work, and once you finish
it is
repaired
the current fair market value is worth $100,000, then typically they can
lend
you up to $70,000, which would cover the cost of the house and the repairs.
Other
terms you can expect are high interest rates. Interest rates start from 12% -
20%
annually and terms may last for six month to a few years. Many times these
rates
vary determined by your credit standing and experience. In most cases, there
will
be
high closing costs or fees to use license money. Typically money lenders will
charge
anywhere from 2-10 points. One point equals one percent of the mortgage
amount.
So charging 1 point on a $100,000 loan could be $1000. These are all
important
things to consider while choosing a money lender.
Other
things to consider are how quick funds will be accessible. Often times, when
you
find investment components, you need to move quickly. Your ability to get
access
to
money quickly can make all the difference. It's important to begin associations
aware
of pre-payment penalties. Pre-payment penalties can definitely hurt your deal
and
cut into your profits significantly. Try to avoid pre-payment penalties.
Many
license money lenders today will also require you to fill out a credit
request
that may ask you for W-2's and or tax statements, your most recent pay
stubs,
and bank statements. Again, it's all about defensive their assets. Yet, some
like
the old fashion way where they only care about the deal so that they do a drive
by or
literally
look at the property. Again the treatment depends on whom you deal with.
When
the use of a money lender? license cash is great for
launch
investors who may not be having money or for those who have bad credit and
cannot
qualify. Speculators also use money when they have to purchase rapidly.
Typical
soft money or conventional loans take 30 days or more. From time to time. Using
a money lender is another resourceful way to lending a property.
Most
like to call it "Nothing Down". If you are able to borrow sufficient
money to buy the
your
belongings, fix it up and then sell on it beneath market value for a profit,
then you've just made money which has no of your personal money. Sure it will
cost you money to borrow
that
cash, but the benefits out way the expense.
How
can you find license money lenders? There are hundreds of
money
lenders waiting to lend you money. It could be your upcoming door neighbor.
The
most successful way to find money lenders is to talk to a mortgage company and
ask
for
referrals. You can even call a title company or a real estate agency. They deal
with
buyers and sellers of homes each day. Shop around until you find the best
one
which will fit your needs. Another way is search on the internet for license
money lenders. Some people would lend countrywide - these typically want a
credit check. If you find a hard money lender in your area, they may just do a
make by.
