Hard Money Blog: Invest, Revitalize, Create, Prosper

How to Refinance a Residential Loan Held in an LLC’s name?

February 28, 2024 by Kyle Sennott Leave a Comment

We’ve written several detailed articles on why it’s important to invest in real estate using an LLC. Actually, it doesn’t matter much whether you are investing in the name of an LLC or any other type of business entity. What’s important is that you don’t invest in your personal name. Why? Investing in the business name protects your personal assets, helps manage your risk, protects your privacy, and might come with some tax benefits. Also, if you are working with a hard money lender, they usually prefer lending to businesses rather than individuals.

Cross-Collateralization in Hard Money Lending

February 14, 2024 by Kyle Sennott Leave a Comment

Cross-Collateralized Properties in Hard Money Lending

Hard money lenders exist because they underwrite radically differently from conventional lenders. They take more risks, think outside the box, and finance the properties that conventional lenders cannot touch with a ten-foot pole. This flexibility allows private lenders to overcome obstacles that will leave a conventional loan dead in the water, including distressed collateral, low borrower credit scores, no verifiable income, and even certain title defects.

Title Defects in Real Estate Investing

February 5, 2024 by Kyle Sennott Leave a Comment

Defects in the title of a residential property refer to any issues or problems that affect the legal ownership or rights associated with the property. Such defects result in what is called a “clouded” title. The opposite of the clouded title is a “marketable” or “clear” title, which refers to a title free from reasonable doubt or defects.
A marketable title reduces the legal risk associated with the property in several ways. First, it assures the buyer that the seller has a legal and undisputed right to sell the property. It also gives buyers confidence that they are acquiring a property without hidden claims or encumbrances, minimizing the likelihood of future legal challenges. If you plan to finance the property with a lender, all lenders, including hard money lenders, will require a marketable title before providing financing. A clear title assures them that the property is sufficient collateral for the loan, reducing the lender’s risk.

What is Probate and How It Affects Real Estate Transactions

December 28, 2023 by Kyle Sennott Leave a Comment

Probate Real Estate Inherited Properties

A part of our business comes from refinancing inherited properties. A typical scenario includes an heir who either wants money to pay off other heirs or needs renovation funds to increase the property’s value before flipping it. Often, they want to do both. Private lending criteria fit their needs perfectly. Hard money lenders like us lend on properties that require extensive renovations and are not focused on the borrower’s income or credit scores. Inherited properties often come with plenty of equity, reducing private lenders’ risk and making the pre-qualification process fast and straightforward. There is one condition, though: the inherited property must be out of probate.

How NOT to Start Conversation with a Private Lender

December 21, 2023 by Kyle Sennott Leave a Comment

Hard money lenders have significant discretion in choosing whom to lend to. Unlike traditional banks or financial institutions that have strict lending criteria and standardized underwriting processes, hard money lenders are private individuals or smaller-size companies that operate with more flexibility. The decision to lend to a particular borrower depends on the transaction itself. Among key elements of this transaction are its overall profitability, the strength of the collateral, and the risk involved in a particular rehab project. These are the tangible aspects best measured by math and underwriting formulas such as loan-to-cost ratio. The intangible aspect of the transaction is how a private lender feels about a particular borrower.

Tracking Renovation Project Expenses: Practical Guide

November 1, 2023 by Kyle Sennott Leave a Comment

Tracking expenses is a fundamental aspect of effective project management in real estate renovation. It helps you maintain financial control, make informed decisions, and ensure the success and profitability of your investment. In this article, we talk about many benefits of efficient cost tracking and share very practical tips on how to do it without overwhelming yourself.

Hard Money Blog: Invest, Revitalize, Create, Prosper

Quick Links

Sign Up For Our Newsletter

Contact Information