There now seem to be dozens of hard money lenders trying to force their cash on real estate investors every day. So why aren’t the most experienced investors biting on the offers?
Whether it is email, social media sites like LinkedIn, or online real estate forums like Bigger Pockets hard money guys seem to be everywhere, aggressively offering their cash. More and more are popping up, and are offering higher LTVs, with fewer requirements.
This is great for the overall market, and hard money has been a crucial crutch for investors for several decades. Even though many left, or essentially turned to conventional underwriting practices when wholesalers and rehabbers needed them most, there are good hard money lenders out there, and those that can add value, and be invaluable in the process.
Five reasons veteran real estate investors aren’t buying in:
Unattractive terms
Trouble separating the opportunists looking to skim deals versus real lenders
Investment strategies have changed
Access to cheaper long term money elsewhere
They’ve discovered transactional funding
Choosing the right type of funding for your real estate investment strategy
Wholesaling with the best transactional funding means just getting in out and paid for sure versus being locked into high rates, with high exit costs, high risk, and no guarantees.
On the other end, buy and hold investors are flush with cash, or have access to far cheaper private money form investors looking for long term yields. In markets like Miami, cash buyers accounted for over 40% of transaction in mid-2014, with almost 70% of foreign buyers paying all cash.
For those simply looking to flip instantly for fast cash and wholesale properties in 1-3 days keep Best Transaction Funding bookmarked in your internet browser and ask about our Proof of Funds to facilitate making more offers.
However, hard money still has its place and uses.
When to use hard money lenders
When refinancing to access and release pent up equity
For rehab projects and fixing and flipping houses
To capitalize on attractive investment opportunities when an end buyer is not yet in place
For taking non-performing assets to performing before resale for maximum profits, or securing lower rate long term financing
How hard money lenders can better serve the investment community
By providing faster approvals
Offering streamlined processes with less hassle and hoops
Developing a reputation for actually funding deals
Working relationships for scaling repeat and referral business
"I want thank you for the excellent service I received from Best Transaction Funding.The quick response I received from your company from the beginning of the transaction and to the end was unbelievable. I also want to give a special compliment to you as well. You went to great lengths to keep me informed and gave my title company all the information they needed to complete a successful closing. I cannot express how thankful I am. Such service builds great working relationships. I will definitely recommend Best Transaction Funding to all my fellow investors. Thank You."
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- Dave Pricken, Real Estate Investor, NJ
"Thank you so much! I just had a talk with our Realtor on both properties and told him amazing things about your company!... Normally I rehab the houses and re resells them. I just don't have the patience for that work anymore. This [transactional funding] is such a better way for me and less stress."
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"Thank you for your commitment to an excellent customer experience."
- Phoenix Properties, LLC, Ronald Destefani, Investor, PA
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"To you I say, ”KUDOS to Best Transactional Funding and Thank you for providing the education and services to Real Estate Entrepreneurs like me. Please keep up the good work!'"
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"You each deserve high marks for your wonderfully quick response time to each of our questions and requests! You hit home runs with us! Your application system was easy to use. Our deal met your qualifications and every time Rob Kozak or any member of Mystic Properties, LLC phoned, we received a "real" person dialing back to speak with us.
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"Boy, you guys are impressive! I can’t thank you enough for scrambling and getting my deal done at the last minute like that. You and your team were awesome!"
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