Hard Money Blog: Invest, Revitalize, Create, Prosper

What Is Asset-Based Lending in Real Estate?

March 2, 2021 by Kyle Sennott Leave a Comment

Private lenders (alternatively referred to hard money lenders) are a narrow subset of mortgage companies that specialize in working with real estate investors. The financing that they offer is asset-based. As the name suggests, asset-based financing is financing that is secured against an asset or collateral. Asset-based financing has a long history that goes back to ancient times when almost anything of value could serve as collateral. In modern times, the most common assets for businesses to borrow against are accounts receivable financing, inventory financing, equipment financing, or real estate financing. Our focus is asset-based lending for real estate investors.

How to Work with Private Lenders Effectively

February 12, 2021 by Kyle Sennott Leave a Comment

Businessman Connects A Small Red Gear To A Large Gear Wheel Symbolism Of Establishing Business Processes And Communication Increase Efficiency And Productivity The Best Business Formula For Success — To effectively work with private lenders, follow these five steps to success.

Much of the advice on private money loans are focused on how to get qualified for them. While it’s certainly an essential topic, an equally important subject is how to ensure your success once you obtained that funding. So, how to work with private lenders to ensure your success? Let’s face it – your ultimate goal as an investor is to maximize your profits. Repaying your private money loan as quickly as possible is a necessary milestone in meeting such a goal. By moving through your rehab efficiently, you can save thousands of dollars. In contrast, every additional month your loan is outstanding will cost you a pretty penny in carrying costs such as interest payments, taxes, and insurance. If you fail to repay a loan within a term agreed (typically twelve months), you might also incur default fees and interest. All of them would take an additional chunk out of your profits.

DC Real Estate and Multiple Offers: How to Stay Rational and Avoid Risk

February 5, 2021 by Kyle Sennott Leave a Comment

Multiple Offers Washington Dc Real Estate — *Experienced real estate investors have the discipline to know that getting the right property at the right price is a process and is not a sudden stroke of luck.*

The real estate inventory is low in the DC area, and any real estate investment opportunity is bound to attract multiple investors’ attention. It’s not unusual for a distressed home to receive twenty or more offers. How do you keep your competitive nature in check and remain level-headed when faced with such intense competition? How do you resist that rush (or high) that real estate investors derive from being that winning offer? How do you make sure that the need for instant gratification does not cloud your judgment? The answer is in unbiased financial analysis, disciple, and perseverance.

Real Estate Investment Partnerships

January 29, 2021 by Kyle Sennott Leave a Comment

Private money lenders offer their borrowers incredible leverage. For you as a borrower, leverage means using the other party’s funds to pay for as many expenses of buying and rehabbing a home as possible. Still, all private lenders want their borrowers to invest at least some of their own money. That helps them manage their risk by ensuring that their borrower is financially vested in the transaction. For real estate investors, the most prevalent reason to create a real estate investment partnership is to pull together enough funds to satisfy their lender’s contribution requirement. However, many of them define their partnership in loose terms without realizing the pros and cons of each scenario.

Real Estate Investing Business Plan: What You Need, What You Don’t and How to Create One That Rocks

January 22, 2021 by Kyle Sennott Leave a Comment

Writing Real Estate Investing Business Plan — *To develop a real estate investing plan that means business, do away with things that might be time-consuming but add no practical value.*

For private money lenders like us, January is the busiest month of the year. Not in terms of closings but certainly in terms of inquiries about our financing. I swear, making money in real estate must be on many folks’ new year resolution lists. As with many other new year resolutions, they tend to pitter out as time goes on. Only the most determined remain in the game and ultimately make money in real estate. So how do you make sure you are not one of those folks who are full of grandiose plans in January only to be full of excuses by Fall? Human psychology suggests that we are creatures of habit and struggle with maintaining dramatic changes to our behavior. This is exactly why so many diets fail. They call for a complete overhaul of our behavior without addressing our natural propensity to maintain the status quo.

DMV Real Estate Investing 2021. What the Future Holds and How to Prosper.

January 7, 2021 by Kyle Sennott Leave a Comment

As I write this blog, a new year is dawning. Maryland has just vaccinated 1% of its citizens. I am not sure whether to be excited by this number or to be concerned with the Herculean task ahead. It’s truly like glimpsing a tiny flicker of light at the end of a very long tunnel.
So what should we expect from 2021? It’s certain that it will bring new challenges. And with challenges usually come opportunities. A Yiddish proverb says, “We plan. God Laughs.” Last year, we’ve made predictions about 2020 but, surprisingly, not all of them turned out to be wrong (see how accurate we were here). So let’s indulge ourselves. I bet that with some reliance on the past performance, the recent and historical data, and our collective local real estate market expertise we can make predictions that will withstand the test of time (save for an alien invasion, of course).

Hard Money Blog: Invest, Revitalize, Create, Prosper

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