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The present-day real estate market holds layers of great complexity for financial institutions, investors, lenders, brokers, and borrowers alike. How are good real estate investments made? How can the process prove advantageous for all involved parties? Networking is integral to success in this industry—especially to address growing consumer needs and unique demands.
“What’s mine is mine” may seem to define the idea of “property,” but it’s not as clear-cut as you may think. Land is the perfect example, as it’s legally owned by an individual and falls under the umbrella term of “property.” But what type of property? In the U.S., there are two main categories: personal property and real property.
Purchasing a property to rent or fix-and-flip is a wonderful investment choice. Like any investment, the venture offers great potential risk and reward. Choosing a solid property for investment is an arduous task by itself, but what about finding financing for it? How do you go about the process? With a little preparation, consideration, and ideation, real estate investors have numerous options in reach. Investment property financing appears in several forms with different criteria.
Private money lending services are intended for all types of commercial and residential real estate investors. Direct private lenders can cut straight through the red tape of traditional lending to provide borrowers with alternative investment opportunities in real-time. Honest lending from experienced industry professionals is key to avoiding sudden hiccups or underlying surprises. With hard money, borrowers can secure a linear path toward time-sensitive prospects on the horizon.
Navigating the murky economic waters of the present-day lending market is no simple feat. The variety of available loan options stretch far and wide—and they’re certainly not one-size-fits-all. Fortunately, we’re here to provide greater clarity about private money lending in real estate, the most lucrative modern investment market.
The often misunderstood concept of hard money lending has been known as the black sheep of the money lending industry for a long time. As a matter of fact, hard money loans in some shape and form have been around since ancient civilizations. Hard money is a valuable concept of credit financing dating back to around the 18th-century B.C.E.
Hard money lenders have become an increasingly mainstream source of alternative financing in recent years. Nevertheless, some potential and current investors lack a thorough understanding of what makes hard money loans a suitable funding choice.
Novice real estate investors may be a stranger to industry terminology, but seasoned investors are relatively familiar with the term of a private money loan. In fact, many investors tap into the versatile resource for their own financial endeavors. Private money loans are ideal real estate loans for properties and investors that don’t fit the traditional mold.
When it comes to securing a loan for real estate, most people turn to one out of two possibilities: a conventional loan from a bank or financial institution or a private lender that offers non-traditional financing. The terminology between the variety of private loans can lack clarity, but understanding the difference between private and hard money loans is more clear-cut than you think. Let’s examine closer where the distinction lies.
Commercial real estate, in plain terms, is definable as a non-residential property that’s income-generating. In comparison to residential investments, such properties can be a dominating source to amass wealth and generate solid cash flow. Commercial real estate loans are solely for business but can be generally sorted into three broader categories: loans for development purposes, loans for investment purposes, and loans for business purposes.