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7 Ways For Your End Buyers To Fund Deals In 2018

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on Sunday, 07 January 2018
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Successfully flipping real estate deals in 2018 relies a lot on finding end buyers with the financial means to purchase properties. The more that flippers and wholesalers can help prospective buyers find and connect with financing, the more deal volume to be done, and the faster they can be flipped.

Here are seven ways your flipper, rental property, and retail buyers can fund their purchases from you this year.

IRAs & 401ks

There is a lot more awareness of the ability to invest in real estate through self-directed retirement accounts today. Others still need to be turned on to the option. Though many more may begin to use these account options as the stock market continues to inflate and stocks become more expensive.

1031 Exchanges

Some US real estate markets appear to have matured, as have some individual investments. By using a 1031 exchange, investors can acquire your deals, while deferring tax liability on their gains.

Private Lending

Investor buyers without enough of their own cash and capital can find that individual private lenders are still the best option for financing. These lenders can be far more aggressive in terms and loan amounts, and are typically far faster and easier to work with.

Hard Money Loans

These loans are great for those who don’t want to deal with the hassles of conventional mortgage loans, or may be buying properties with repair needs that fall outside of conventional underwriting requirements.

Rehab Loans

Whether from investor specific lenders or the FHA 203k loan, there are great funding options for acquiring houses at a discount that need some repairs or updating.

Low Down Payment Loans

While investor loan LTVs have risen to 90% and even 100% in some cases, regular home buyers are also finding more and more low down payment options as well. This ranges from government loan programs like USDA and VA loans, to those offered by mortgage lenders like Flagstar which can be combined with local down payment assistance programs.

Seller Financing

Seller financing is still one of the best ways to ensure fast resales at maximum resale prices. That may be a low down payment large first mortgage, or carrying a second mortgage loan.

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Is Your Real Estate Agent Helping Or Hurting Your Sale?

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on Thursday, 09 February 2017
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Are real estate agents really helping or hurting investors’ efforts to sell homes?

Many property investors and regular homeowners simply aren’t aware of how beneficial or harmful Realtors can be in the mission to sell their properties. How do you know if yours is doing their job? How do you spot the good among the terrible?

The Issues

Just as with investors, not all Realtors are perfect. But, there are great ones out there. They can offer a lot of value to those flipping houses, restructuring rental property portfolios, and searching more homes to buy and wholesale. Those that fail to operate ethically, don’t have the hustle, or simply are not tuned into current trends can really hurt the sellers they represent, and be a major roadblock for buyers.

Unfortunately, some agents still hold out on presenting offers; either to wait for the one which offers them double commission, or because they don’t understand them. Some are just slack at returning inquiries and following up. Others don’t have the motivation and hustle to try and make deals work and make the most out of every lead.

This doesn’t serve anyone well. It can result in properties rotting on the market, owners losing homes or failing to get the most money in a timely manner, and it can choke the pace of the market too.

What to Look for in an Agent

To beat the above issues real estate investors need to select the agents they work with carefully. Don’t just hit Google or go based on who has a lot of yard signs out. Don’t base the choice on years in business either.

Instead, look those you can build a relationship with. Those that put values and service first, those that are hungry and active, and those that can answer questions about quirks in the market or can find out fast.

Test them. Do they answer calls on their properties fast? Do they take offers and try to make them work? Do they know the requirements of local associations, building codes, and mortgage lenders?

Always do a little mystery shopping before selecting an agent to help you. Then if you list with them, do it again. See how well they are serving potential buyers for your property. If they aren’t presenting you offers, responding, or being courteous, you may have a case to fire them and find someone better.

What have you found is most and least important in choosing an agent? Let us know your favorite investor friendly agents around the country on our Facebook page

 

Authored by Best Transaction Funding BestTransactionFunding.com is the leading source of transactional funding for real estatewholesalers in the US, where 100% financing, and saying “Yes” is what we love doing all day long.

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Gaps In Real Estate Data Creating Opportunities For Wholesalers

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on Thursday, 02 February 2017
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Are gaps in real estate statistics creating more opportunities for property wholesalers?

Being equipped with data is good. At least if the data is good. Billions have been spent on big data. Yet, especially in real estate, the numbers can be misleading. Those with access to good information and who know the market can benefit, while helping to educate others.

Real estate stats typically lag by a couple of months between collection and being published. Sometimes it’s three months or more. These numbers are also often revised backwards too. And we all know that even some of the biggest and best funded real estate data providers are horribly inaccurate. This can be compounded by the media who is able to twist and filter the information to make clickable stories.

Right we are experiencing a unique moment in the market. Things seemed to be cooling down and heading for a dip last year. People were pessimistic about the market. Now we are in a new environment which is rich in optimism. However, this lag in data, coupled with seasonal data glitches has some buyers waiting, hoping sellers will cut prices, and some sellers being told by their agents that they should cut prices.

We’ve recently seen the Dow Jones hit a new record of 20,000, Warren Buffett make a $12B investment, and mortgage lenders eagerly stepping up to fund more deals. With the exception of San Francisco, Zillow is still pretty bullish on its outlook, and that home prices will mostly keep rising in 2017. The latest Wells Fargo and National Association of Home Builders index shows confidence is now the highest it has been in at least a year.

So, bolder and more positive real estate data is likely to show up soon, to reflect current purchasing sprees. Then sellers and buyers will be more aggressive. However, this current gap may give wholesalers an opportunity to get in and pick up well-priced deals before that happens, and to flip houses in markets they want to exit.

What will you do?

 

Authored by Best Transaction Funding BestTransactionFunding.com is the leading source of transactional funding for real estate wholesalers in the US, where 100% financing, and saying “Yes” is what we love doing all day long.

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The Investment Property Mortgage Landscape in 2015

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on Thursday, 26 March 2015
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What does the mortgage landscape look like for investment property loans in 2015?

While Bloomberg Business notes that mortgage underwriting is becoming “incrementally easier” in 2015, the feds have opened up the gate to begin raising interest rates. These factors will have some impact on real estate investors as they evolve and grow. But for now the most important question remains “what loans are available for financing investment properties?”

Transactional Funding

Best Transaction Funding continues to fill the gap for property wholesalers. It provides 100% financing for quick flips. Normally without any of the credit, income, or asset demands of other loan types.

Find out how transactional funding works here

Hard Money Loans

Best Transaction Funding will soon be funding hard money loans from 1M+ (minimum) for select, serious, and experienced real estate investors with solid deals.

Hard money loans offer asset based financing for those deals and transactions that don’t fit the transactional or conventional loan model. They provide fast funding, without the hassle of traditional investment property loans from conventional banks and lenders. They can be great for new acquisitions, rehabbing, and refinancing.

Blanket Mortgage Loans

A variety of new blanket mortgage lenders and loan programs have emerged over the last two years. These programs can help investors with bulk property purchases, may act as bridge loans to unlock pent up equity in existing portfolios, and may streamline overall debt financing for buy and hold investors.

Private Money

Private individuals continue to be keen to put their money to work in real estate deals. For now they can offer better terms and easier lending than conventional lenders. The downside can be the extensive amount of work and time required to line up these relationships and financing. There may also be a substantial pivot in this trend as other lenders become more competitive in 2016 and beyond, and as they can obtain high yields from CDs.

Leveraging IRAs

Tapping IRAs and other types of retirement accounts to fund real estate deals has become increasingly promoted among the investment community. Self-directed IRAs do have great advantages. They can even be used in tandem with private money, transactional lending, and hard money. However, investors should recognize that touching the proceeds of these transactions might hamper their tax benefits. Highly active flippers should also consult their tax professionals to see exactly what the tax ramifications are for them.

Conventional Lenders

Traditional banks and mortgage lenders still have a lot of catching up to do. This is particularly true when it comes to LTV, paperwork burden, and speed. More exotic loans are making a comeback, but these lenders are rarely of benefit to most investors in the current market.

Summary

Investment property financing is still plentiful for those that know where to go, and work with the best lenders for their investment strategy. Whether, and how fast main street banks will be to catch up will be to be seen.

Make sure on our email notification list for first to know of new loan programs and features!

Authored by Best Transaction Funding BestTransactionFunding.com is the leading source of transactional funding and hard money loans for real estate wholesalers in the US, where 100% financing, and saying “Yes” is what we love doing all day long.

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The Best Places To Live For Real Estate Wholesalers

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on Wednesday, 18 February 2015
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Where are the best cities and neighborhoods for real estate wholesalers to live in 2015?

A recent thread on popular online real estate forum Bigger Pockets raised the question of why investors choose to live where they do (if they do), and why?

Top Cities, Myths, and the New Economic Landscape

There are a variety of indicators to follow for property wholesalers that are considering relocating. This might include where the cheapest homes in the US are, following the claims that the massive pool of today’s millennial buyers are flocking to dense urban living, or tracking the markets that check all the boxes of what home buyers say they really want in a home today. Then there is the question of whether real estate investors should relocate to destinations that appear to promise more growth. For example; RealtyTrac’s nod to Jacksonville, FL or San Francisco, CA for the largest house flipping profits and spreads. Or to NJ where RealtyTrac reported the highest percentage of foreclosures at the beginning of 2015.

We have lists like this from RIS Media laying out the ‘Best US Markets for Buying Residential Rental Property’, and Forbes’ list of ‘America’s Fastest Growing Cities 2015’. There are also lists of cities for hot jobs, though as we’ve seen with the recent oil price crisis; trenches of the country relying on a single industry can boom and bust fast.

So where should wholesalers live?

What Wholesalers Do & Don’t Need in a New Home

Do real estate wholesalers need to be in the midst of high distress cities and neighborhoods, or in the pockets that are favorite with VC money, and where mortgage lenders prefer lending?

Being in the middle of the action, and where the money is can have its perks. However, technology has also made it possible for real estate wholesalers to operate completely independent of location. If you’ve got internet and a decent cell phone signal you can flip houses from anywhere.

So as tech continues to develop and internet gets faster the best places for property investors to live might be where they do their best work, and enjoy the lifestyle the most.

For some this might mean a city center condo for doing business during the week and then retreating to a rural estate for the weekend. Others might set up in the burbs where the weather is better year round and living costs are lower thanks to cheaper real estate and tax breaks. This could make inspirational cities like NYC, new tax havens like Puerto Rico, and vibrant sunny escapes like South Florida standout.

Where will you move?

Authored by Best Transaction Funding BestTransactionFunding.com is the leading source of transactional funding and hard money loans for real estate wholesalers in the US, where 100% financing, and saying “Yes” is what we love doing all day long.

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Flipping Tiny Houses

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on Wednesday, 16 July 2014
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Should real estate wholesalers jump on the tiny house movement and flip micro lofts and apartments?

There’s no question that small is the new big in many real estate circles. This may be far more to being priced out, and out of credit, than a new highly desirable home feature, but tiny houses are in. There is even a new reality show trying to nurture the art of living smaller – Tiny House Nation. The big question is whether real estate investors should get into flipping this ‘hot’ commodity?

Tiny houses are cute, they’re cheap, and they may be a profitable product line for some. However, they are not without their challenges. For a start there are certainly a number of government and utility agencies that are none too happy about a new generation living without their services, skirting building codes, and more.

With the best transactional lenders providing almost limitless capital to wholesalers, and landlord friendly mortgage lenders opening up the money gates to fund rental properties some investors may be under the impression that everything is a great buy, and easy flip today.

Aside from the code and title challenges of attempting to buy and resell tiny houses, there is perhaps an even bigger issue many are completely aware of. Even if everything else is great, most lenders won’t only shun small balance mortgage loan applications; they won’t dream of funding such small units. Most are unaware of these underwriting conditions because they rarely come up, but many lenders will have minimum square footage requirements.

There may be some exceptions for those really set on trying to work this niche. Where small condo units or homes are standard, and there are plenty of comps, some local banks may finance them. Then there are hybrid homes such as those being manufactured by Mesocore which are up to code in the areas they have been built, and offer all the benefits of green and affordable living, but are real homes. And they are at least 1,000 square feet.

 

Tiny house architecture is cool, but be aware that flipping tiny houses might be far more challenging, and less profitable than many hope.

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Is Your Lender Poaching Your Deals?

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on Thursday, 24 January 2013
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Are mortgage lenders poaching your deals and leads?

This is an increasing issue, especially with more competition among real estate investors, mortgage originators and for locking down great deals on distressed property. This is becoming a major problem when those directing private funds are also involved in flipping houses or rehabbing and renting them, as well as for the greedy few wanting to make more money on each loan they make.

You do all the leg work and research for them, and they essentially get not just free leads but all their due diligence done for them too.

Have you ever shopped a deal for financing only to find it was sold or the seller backed out when you went back to them? Or as a broker found your client went with someone else? Your deal could have been poached!

Why work so hard and then have those you thought were there to help rob you of the profits?

Transactional funding remains the best way to fund your flips and wholesale deals. It’s fast, less expensive than hard money, a whole lot easier to get your hands on, and can make a ton of difference to the bottom line and net profits.

At Best Transaction Funding all we do is loans. You do what you do best in finding and flipping houses. While we stick to what we do best; funding loans.

Building relationships and preserving our reputation are our top priorities. You’ll find no conflicts of interest here. Try out the Best Transaction Funding difference today…
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