Located in beautiful Ventura County, Thousand Oaks has miles of coastline and the breathtaking Santa Monica Mountains. This makes Thousand Oaks a perfect place to live, work and buy investment property. The housing market can restrict the ability to obtain funding for a house or property. Sometimes banks and credit unions are stingy about who receives a mortgage. This can make buying investment property, building homes or buying a home absolutely out of the question.
What is a Hard Money Loan in Thousand Oaks?
A hard money loan is a private loan specifically to fund a real estate. The loan isn’t offered by banks or credit unions. Instead, they are offered by private investors and companies. The purpose of a hard money loan is to start a real estate project or obtain funding for a home. The money is short-term. A borrower has two to five years to repay the entire loan, plus fees and interest.
Understanding a Hard Money Loan in Thousand Oaks
Hard money loans are a great alternative to the traditional bank loan. However, it’s important to understand this private loan. It requires collateral and a down payment. The collateral is the property being financed. The down payment depends on the value of the property after a full appraisal. For example, a borrower plans to fix-and-flip a property. The value of the property is $100,000. The hard money lender may require a $20,000 down payment. Thus, it’s important to understand the Loan-To-Value (LTV) ratio or After-Repair-Value (ARV) of the property to understand the type of money needed to obtain the loan.
Regardless of the number of payments all hard money lenders require a balloon payment at the end of the loan. This payment includes the remaining balance due on the loan and any interests and/or fees included.
Why Thousand Oaks Borrowers Seek Hard Money Loans
A hard money loan is an option for people who can’t get a traditional bank loan. Credit unions and banks want borrowers to meet high requirements such as excellent credit scores, high income and low debts. Many people don’t fall into those categories. Banks and credit unions based their lending decisions on those things plus if a borrower has any foreclosures or bankruptcies. Thus, some borrowers seek hard money loans for this reason.
Some borrowers need money quickly. It can take weeks or months for banks to approve loans. A hard money loan allows a borrower to get the financing they need for a construction project or a flip-and-fix project. Having large access to cash provides investors with the ability to take advantage of real estate opportunities they’d miss while waiting for a bank loan.
Flexible terms are another reason borrowers seek hard money loans. A hard money loan terms are flexible. Many lenders are willing to customize their hard money loans, according to the borrower’s ability to repay. This means no cookie-cutter loan terms such as the ones from a traditional bank that places more pressure on the borrower to repay when their finances don’t make the repayment plan.
Thus, Thousand Oaks residents seek hard money loans because:
• They can’t get financing anywhere else
• They need money immediately
• They want more flexible terms than they are offered by traditional banks.
Get Your Hard Money Loan in Thousand Oaks with Our Help
Thousand Oaks offers a variety of recreation, shopping and relaxing options to help you live and play. You should have the same options when it comes to financing real estate opportunities. Whether you are investing in Thousand Oaks property or buying a home, you have a financing option. Contact us about securing a hard loan today.