Why Consider Hard Money Loans for Houston Real Estate Investments
Houston is currently experiencing a strong housing market growth. This is mainly because of the influx of new companies and jobs moving into the area. Demand for housing has already surpassed supply and the house prices continue to rise as a result of it. This is a great opportunity available for the Houston real estate investments. You can capitalize on flipping undervalued properties or acquiring Houston rental properties in this hot market.
Regardless of opportunities available, traditional financing can be difficult to obtain quickly for your investments. This is where Houston hard money loans can help.
What Are Hard Money Loans?
Hard money loans are a form of asset-based financing provided by private money lenders. Unlike traditional bank loans, hard money loans are based on the property itself as collateral rather than the investor’s credit score or financial history.
Hard money lenders provide faster access to capital, higher loan-to-value ratios, and fewer borrowing restrictions since they are assessing the deal based on the real estate asset. However, hard money loans typically come with higher interest rates and fees compared to conventional bank financing.
Why Hard Money Loans Work for Houston Real Estate
Now you have a basic idea of what hard money loans are all about. With that in mind, let’s explore why hard money loans are a great option available for Houston real estate investments.
- Speed
Hard money lenders can offer funding in a matter of days rather than the weeks or months it takes to get approved for traditional bank loans. When competition is fierce, speed becomes critical for securing good deals.
- Funding for Fix-and-Flips
Banks shy away from lending to distressed properties that need repairs. Hard money loans readily fund the acquisition and renovation costs to flip properties.
- Lower Down Payments
Hard money lenders may offer 70-80% loan-to-value ratios so deals can be done with less money down. This helps anyone with low capital to get into the Houston real estate investment scene.
- Non-Traditional Properties
Hard money works well for non-conforming properties like vacant land, and commercial buildings that banks may not finance.
- Less Stringent Requirements
Those newer to real estate investing often don’t qualify for standard loans first starting out. Hard money provides more flexible options.
As you can see, hard money can serve as a short-term bridge loan. It allows investors to capitalize on time-sensitive deals that mainstream financial cannot accommodate.
In essence, hard money serves as a short-term bridge loan allowing investors to capitalize on time-sensitive deals that mainstream financing cannot accommodate.
Houston Hard Money Lenders: FlipCo Financial
The opportunities for Houston real estate investments exists now more than ever. Hard money serves as the rocket fuel to power those opportunities for motivated investors. Hence, you can think about using it as the path to proceed with your real-estate investments in Houston.
If you are on the lookout for a hard money lender in Houston, feel free to contact us at FlipCo Financial. We are one of the most respected hard money lenders in the city. By working with us, you can secure capital to proceed with your real estate investments within just 72 hours.