Phone: 240-436-2340
Maryland Hard Money Lenders. Private Loans in Maryland, Virginia & Washington, DC
So you want to start investing in real estate? Let’s assume that you have some funds to invest in and have been pre-approved for a hard money loan by a reputable private money lender. Now you are ready to start looking for the right property to flip. Where do you begin? Here is some actionable advice that would help even new investors develop a killer strategy to grow rich in real estate.
We are excited to announce that we’ve finally launched a new version of our hard money calculator. We wanted to create a new version because we felt that all existing hard money calculators (including our old version) fall short of what our borrowers really need. They are clunky, difficult to use, and the results might be challenging to interpret. In addition, all of them look the same – as if they were copied from the same place.
We wanted our hard money calculator to be different. Our first requirement was an intuitive interface. Many newer borrowers do not consider all costs associated with buying, rehabbing, and selling an investment property. Our goal was to educate them that calculating your profits is more complex than subtracting the purchase price and the renovation costs from the after-repair value of the property. Even borrowers with experience and sophistication often neglect to account for some expenses – overestimating their projected profit as a result.
The Holiday season is upon us. Things traditionally slow down, priorities shift, and with the barrage of family responsibilities, it’s challenging to make time for real estate investing. Or so the conventional wisdom goes. In reality, it’s a unique opportunity to snatch a deal – while your competition is busy roasting chestnuts and sipping the eggnog.
The main difference between private and traditional lending is that private lenders base their loans on the after-repair value of the property. In contrast, conventional lenders base it on the current market value. Both the after-repair value and the current market value is ultimately determined by a licensed appraiser. However, the after-repair value is the value that is not there at the time of the appraisal. It’s simply a projection of what the property might be worth once the planned renovations are completed. It’s based on the sale prices of similar properties rehabbed to the same extend our investor plans to rehab hers.
The underwriting speed is one of the main differentiators between hard money loans offered by private lenders and conventional loans offered by traditional mortgage companies. “How long does it take to close?” is often the first question prospective borrowers ask. In many cases, this is a rhetorical question: if a new investor knows anything about private lending, it’s that it’s faster than other types of financing. Private lending does not provide consumer financing and is not subject to extensive regulations and requirements. Hard money financing is heavily focused on the property itself and its ability to both make money for the investor and serve as sound collateral for the lender. When working with investors, the cornerstones of conventional underwriting, such as credit scores or the ability to make payments in the long-term, might be less important.
The “Covid-19” real estate performance numbers are officially in and guess what? It had another record-breaking summer. In July, the median home sales price hit a ten-year high, posting a 13% increase from last year.
What does it mean for you? It means that if you bought a property for $200K in summer 2019, by now you would have been at least $26K richer. Just think of it – you would have earned $26K by doing virtually nothing.
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New Funding Resources, LLC
806 West Diamond Ave.
Suite 340
Gaithersburg, Maryland 20878
Phone: 240-436-2340
All loans subject to our review of underwriting criteria and conditions. We reserve the right to approve or deny any loan application based on our sole discretion.
New Funding Resources 