When we look at the consumer market, there are tons of programs to help buyers get into homes without a down payment. Most commonly, they’re through government agencies like the Federal Housing Administration (FHA), United States Department of Agriculture (USDA), or Department of Veterans Affairs (VA). Although the agencies don’t directly administer the loan, they offer banks and other financial institutions a guarantee on some or all of it, so the lender can offer loans to people who wouldn’t ordinarily qualify or provide more favorable terms.
While that sounds like a fantastic deal, and in some cases, it really is a boon, most people don’t realize there are still costs. They’re paying for the privilege of getting a loan this way. For example, the loans don’t cover closing costs, which is usually 2-5% of the sales price. Ergo, most people have to come up with a little over $3,500 to seal the deal. In addition to this, there’s usually a stipulation that says the buyer has to have mortgage insurance, which tacks on close to $100 per month for a typical homebuyer.
So, even in the consumer market, there’s not really a way to get into a home without having some cash, but in the commercial sector, it becomes even more challenging. Those government programs don’t exist for investors, which is why people start looking for Arizona 100 LTV hard money lenders.
While searching for Arizona 100 LTV hard money lenders, you’re sure to find that most aren’t really offering you 100% of the value of the property. Chances are, you’ll fall in the 60-70% range or perhaps even lower. They want you to have some skin in the game because it reduces the chance you’ll default and makes the deal less risky for them if you do. Would you lend someone $50-100k or more if that party wasn’t as invested as you are or if you could lose money on the deal? Probably not. As you explore your loan options, be realistic about what you’re bringing to the table and be mindful that you’re creating a win-win situation for you and your lending team.
There are ways Arizona 100 LTV hard money lenders legitimately get you the full amount of your real estate venture. For example, you could explore cross-collateralization or try to negotiate a lower price on the property. If it’s valued at $100k and you get the seller down to $70k, you’re right in the sweet spot. Some sellers are motivated to do this if they want to avoid a foreclosure or you’re willing to split some of the profits after you sell. If these solutions don’t work for you, speak with a broker who specializes in the area who can explore alternate options to get you what you need.
Level 4 Funding LLC
Hard Money Lender
Hard Money Loans
Hard Money Loan
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis Dahlberg Broker/RI/CEO
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave | Austin | Texas | 78701
About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 43 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.