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How California Hard Money Loans Can Help Your Real Estate Business

According to a popular saying, no man is an island. This old adage stresses the importance of having friends or allies. Because the saying basically means that man won’t survive if left to his own devices, a person should find a trusted companion who will stick with him or her through life’s ups and downs.

By: Dan E. Steckert
Category: Real Estate
Posted: Mar 31, 2010
Updated: Mar 31, 2010
Views: 74


According to a popular saying, no man is an island. This old adage stresses the importance of having friends or allies. Because the saying basically means that man won’t survive if left to his own devices, a person should find a trusted companion who will stick with him or her through life’s ups and downs. The same principle can be applied when investing in the Golden State’s real estate market. If you want to succeed in your chosen endeavor, you have to form alliances with people or entities that can be trusted. This is where lenders of California hard money loans come in.

What’s good about hard money lenders is that they enable you to invest in the local real estate market with “no money” down. Typically, California hard money loans have a loan-to-value ratio (LTV) of around 65%, meaning lenders will give you 65% of the estimated after repair value of the property you want to borrow money for.

For example, you want to buy and rehab a fixer upper home worth $40,000. An appraisal on the property showed that the house will be valued at $100,000 once the necessary repairs and renovations have been carried out. Based on the LTV of hard money loans, you can borrow up to $65,000 from the lender.

Now that you have $65,000 at your own disposal, you can purchase the property for $40,000. You still have the remaining $25,000, which you can use to buy construction materials, pay for contractors, and take care of related expenses. With California hard money loans, it is indeed possible to make money in real estate without spending cash up front.

Aside from providing solutions to your financial problems, one of the greatest benefits of seeking the assistance of the local hard money lenders is that you don’t have to wait for weeks or months just to get the funding that you need. Unlike their traditional counterparts, lenders of hard money can quickly decide if a loan application is worth their time or not.

Because hard money lenders verify the eligibility of a loan by assessing the value of the property for which the loan is being made, they don’t require borrowers to undergo credit checks or present documents and a verifiable proof of income. Thus, they don’t spend too much time checking the financial background of the borrower.

To learn more about California hard money loans, visit www.RehabHardMoney.com.

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