eliminating contingencies with hard money
Surely, you or one of your clients have been in this situation: You unexpectedly find a property that you think is perfect. It is one of a kind, and you really want it. But there is no way you can buy that property unless you sell your current property first. Furthermore, there is no way the seller is going to wait for you to sell your current property. You have a limited amount of time to make this deal work. What options do you have?
The way to get the job done is to first, secure the money for the down payment. Second, you get a loan for the rest. That gives you time to sell your current property without risking losing the opportunity to buy your dream house.
Let us talk about the first step, the down payment. If you do not have the money for the down payment, you can take a second mortgage on your current property. We all have heard of traditional equity lines of credit. Typically, it takes at least 30 days to get one. Currently, banks do not even issue them. Also, when they are available, many, especially business owners and self-employed people, do not qualify.
hard money line of credit: who knew there was such a thing?
Everyone has heard about equity lines from a regular bank. As with most bank loans these equity lines require that the borrower qualifies which includes having good credit. Some people, and especially, business owners, often do not qualify for these kinds of loans. This is because they cannot show their income clearly enough or their credit history does not pass the bank’s standards.
But there is great news. Now there is a hard money line of credit available. A hard money line of credit is like an equity line that you would get from a bank like Bank of America or Wells Fargo. You only pay interest on the money you use. That is the beauty of such a loan; you only pay interest on what you use. That is a lot cheaper than taking out a loan that you will not need for a while, yet you are paying interest all along.
A hard money line of credit is a great tool if you know you will need hard money at some point, and you want to have it ready to go when you need it.