Investment property lenders are generally property lenders that loan you money when investing in property.
These lenders are better known as hard money lenders or private lenders.
Let me explain the difference between the two.
Hard money lenders usually are private lending institutions that will loan on investment property only. Which means you’ll be buying an investment property of sorts.
However, most hard money lenders will only loan you money for a short period of time.
It’s more than likely you’ll be using these types of loans for your real estate flips.
With that being said here are some of the fee’s you can expect to pay for hard money. Typically, these types of lenders will charge anywhere from 3 to 9 points plus your closing and repair costs upfront. Also, expect to pay a 10 to 15% interest rate for your loan.
It sounds expensive; I know but think about it for one second. If you’re going to be buying a property as a real estate flip, paying 10 to 15% interest for a loan that you received without any credit checks, is really not that bad.
Once you have established a relationship and have proved yourself with your lender you can negotiate for a much better rate and you can also try to roll over payments into the loan.
You can find a hard money-lender by conducting a search on the internet by simply typing in your city of choice followed by the word hard money lenders.
Another great way to find a loan on investment property is the use private lenders.
Private lenders can be just about anyone with capital to invest. There great because you can offer a safe, secure, guaranteed investment with returns of 8 to 15% and you don’t have to pay any points up front.
Having private lenders on your side can be a win, win for all parties involved.
Here are some helpful hints as to where to find private money lenders.
The first thing you must do is ask yourself “who do I know?”
Do you go to the doctors?
Do you go to the dentist?
Do you have an attorney?
Do you know someone in upper management?
These are just a couple of helpful ways to get you thinking about important people you might know.
Build a strong relationship with your investment property lenders and you’ll never have a problem getting an investment property loan.