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Read our most recent blog posts for information and updates on private money investing, hard money financing, the housing market and everything in between.

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Hard Money and Private Money Second and Third Mortgages

When it comes to second mortgages, you probably fall into one of two camps. The first sees refinancing their homes as a terrifying financial prospect. The second sees a unique opportunity, which presents plenty of benefits in the right circumstances.

Second, or even third, mortgages will work to your advantage in certain situations. Like all forms of credit, you're probably going to need a decent credit score to get your hands on one. However, if yours is less than perfect but you still want to maximize the credit you can obtain against your property's value, hard money and private...

Hard Money and Private Money Owner-Occupied Loans

At one stage or another, there will come a point in your life where you need to access cash quickly. As the name suggests, an owner-occupied loan is a loan which you will take out and secure against the property you live in. While some people use these loans for meeting personal expenses, others will use them to fund investment projects. Such projects usually take place in the real estate industry. If you’re trying to secure a private money owner-occupied loan, you may find that doing so with a view to expanding your current property portfolio works to your...

The Real Story Behind Fix & Flip TV Shows

We all know how entertaining it is when the complex details of the property market are summarized in a half hour TV show. Whether you're hooked on Property Brothers, Love It or List It, or Fixer Upper, reality TV shows make renovations and property flipping seem easy. While real estate investors can definitely learn a thing or two from these shows, there are lots of things going on behind the scenes that are completely left out and just as important. Let's take a look at what you can and can't learn from reality TV so you can set realistic expectations...

Real Estate Investing: Going from Part-Time to Pro

Investing in real estate can be a financially rewarding experience. While it's possible to become a successful part-time real estate investor, it's true that the more time and energy you dedicate to something, the more likely you are to succeed. Property investment is no exception. Most new investors don't know how to make the leap from a part-time side job in real estate to investing full-time, but the good news is that it's possible as long as you're willing to put in the work.

Here's what you need to know about going from a part-time to a pro real estate...

How to Choose Trustworthy Contractors

One of the most important elements of flipping a house is the team you put together to work on it. An ideal team is made up of knowledgeable, trustworthy individuals that aren’t afraid to get their hands dirty. Your team is likely made up of a design guru, a plumber, an electrician, and a contractor—or five.

A contractor or contracting team is one of the most important additions to your team and its crucial that they’re trustworthy and accountable. If not, you could find that deadlines aren’t met and work is sloppy. But how do you know if a contractor...

Hard Money and Private Money Construction Completion Loans

In the construction industry, every project is time-sensitive and speed can make or break the success of the project. When you’re confident that your efforts will result in excellent profits, you don’t want to wait around for slow financing. Although traditional finance is available for construction completion loans, it isn’t always quick and easy to get an institutional loan. Even when you are eligible, you may find that the application to delivery time is too slow for your construction project. Another option is to choose a hard money or private money loan for your construction completion project.

What is a...

Do You Offer Hard Money Second Mortgages in California?

The most popular question I've received over the past two weeks has been, "Do you offer hard money second mortgages?"

The short answer is "Yes, no, maybe, maybe not."

In other words - it really depends on the property, use, protective equity, and much, much more.

For those not familiar with the hard money second mortgage market in California, it dried up in 2008 with the bursting of the first housing bubble. Many of the trust deed investors making second mortgages up to 70% combined Loan-To-Value (CLTV) against the inflated home values of the bubble years lost their entire principal when...

Four Scenarios When Private Money Loan Are the Right Choice

While traditional forms of financing are always an option, private money loans are becoming increasingly popular. Alongside their fast turnaround times, they're often more accessible to those with a less-than-ideal credit history.  Private money loans aren’t the right choice for every borrower, but if you find yourself in any one of these four scenarios private money loans may be worth exploring.

When your credit score is less than stellar

As one of the toughest financial obstacles you can overcome, real estate investment calls for excellent credit scores. From a bank's perspective, this makes perfect sense. They want to know that their...

Can You Trust Investing in Trust Deeds? The Pros and Cons

Investing can be tricky, no matter how financially savvy you are. With the current state of flux in the real estate market, it is no wonder people have questions about whether it's smart to invest in trust deeds. Here's the low down.

What Is Trust Deed Investing?

When someone loans money to someone else (generally called the "Borrower") and the Borrower puts up real estate as collateral, its a trust deed investment. The real estate could be practically any property the Borrower owns, whether it's vacant, residential, commercial, or has tenants. When you invest in a trust deed, you...

Hard Money and Private Money Rental Property Loans

Do you want to invest in the rental property market? Your timing couldn't be better. While the mild lull in the property market continues, now's the time to invest in low-cost properties with the aim of making a neat monthly profit. Before you do, however, you need to consider which form of financing you'll choose. More and more real estate investors are using hard money and private money rental property loans. If you find that traditional finance gives you a headache, it's worth seeing whether they'll work for you too.

What is a private money rental property loan?

In many...

How to Know When to Switch Loan Providers

If you've been involved in the property market for a while, you may have stuck with the same lender through thick and thin. While there's something to be said for loyalty, at the end of the day you need make sure you are looking after your own interests by knowing when it's the right time to switch loan providers. Whether it's expanded loan product offerings, faster loan approval, or increased speed of closing, choosing a new lender can ultimately help you increase your return on investment for your real estate projects.

Are your needs being met? Do you have access...

Hard Money and Private Money Blanket Loans

Although owning and investing in multiple properties is a smart move, it can also feel like an administrative headache. One of the biggest sources of frustration you may encounter is juggling your financial commitments. Obtaining several sources of financing and repaying them all individually can make accounting difficult. As you may already know, failing to streamline your accounts is a fast track to reducing your profits.

As an alternative to achieving several funding sources, you may want to consider a blanket loan. Knowing more about what they are, how you’ll benefit from using one, and ways to obtain a...

Hard Money and Private Money Bridge Loans

Like many people, you probably find the world of investment properties exhilarating. At the same time, you probably experience a lot of the frustrations that come with financing your prospective properties. As the real estate market continues to thrive, there’s a lot of scope for buying fixer uppers and flipping them for a profit. If you want to seize on your latest opportunity quickly, but you feel as though securing finance could cause a delay, you may want to consider a hard money or private money bridge loan.

What Are Hard Money and Private Money Bridge Loans?

Hard money...

Hard Money and Private Money Fix & Flip Loans

If you’re eyeballing a prospective investment property to rehab and you need to finance it quickly, you might want to consider a fix and flip loan. As an investment financing option that’s best secured through a broker, this type of loan is excellent if you’re keen to revamp your property portfolio.

What Is a Fix & Flip Loan and When Will You Need to Use One?

Hard money fix and flip loans allow those who are renovating properties to finance their purchase using existing equity. Said equity usually comes in the form of a property, allowing you to secure...

Hard Money and Private Money Ground-Up Construction Loans

If you’re working in the construction industry, you’re probably already aware that private money lenders have a longstanding history with developers. While banks may sometimes see your efforts as carrying too much risk, new construction loans come with the potential for private lenders. Since the recession, those offering private money construction loans have begun to exercise a little more caution, but they still remain as a viable option.

What is a hard money new construction loan?

A hard money construction loan is a form of finance provided to those who are planning a new residential or commercial building project....

Private Money 101: A Basic Guide to Understanding Hard Money Loans

Hard money loans are often misunderstood, in part because of shady lenders who tainted this type of loan's reputation by providing risky loans that left real estate investors dry with no property to show for it. Now it’s time to dispel the myths and talk about what hard money lending is really all about. This article will provide you with some basic information to get you started.

What Is a Hard Money Loan?

A hard money loan is a short-term loan secured by real estate and funded by private investors as opposed to conventional lenders such as credit unions or...

Get Started in Trust Deed Investing: Why Should I Use a Broker?

Trust Deed Investing Overview

Private money investing and hard money lending go hand-in-hand as inverse functions. Private money lending is different from a traditional bank loan. Borrowers receive funds from private individuals or groups who are looking to invest money on a relatively short-term basis.

The terms hard money lending and private money lending are often used interchangeably. Hard money loans are often used to finance real estate projects. Private investors often lend money based on the value of the property in question, which is called asset-based lending. Lenders can be individuals, small mortgage brokers familiar with real estate investments,...

Hard Money and Private Money Commercial Loans

Where there’s commercial real estate, there’s usually money. While most people associate buying and selling property to make a profit with the residential market, it’s not unusual to take the same approach to commercial properties. If you’re seeking a commercial loan and you’re coming up against barriers, you might find that hard money financing is an ideal option. Choosing a private commercial real estate loan is an excellent way to secure cash quickly. If you’re ready to transform the way you approach commercial finance, let’s explore the world of private lending together.

What is a hard money commercial loan?

Overall,...

Hard Money & Private Money Hotel Financing

Over the past few years, we’ve received dozens of hard money and private money hotel financing requests from existing owners doing a major overhaul as well as buyers seeking acquisition funds to stabilize a property before taking out a long-term bank loan. This blog post outlines a recent competitively priced private money hotel acquisition loan for an experienced operator that we believe would benefit many other hotel owners.

As mentioned above, the buyer was an experienced hotel operator, owning several brands in Northern and Central California. Upon acquisition of the hotel, the new owner would convert the property...

5 to 7-Year Residential 1-4 Unit Rental Property Loan

We’ve started working with a new lender that has a niche 5 to 7-Year Residential 1-4 Unit Rental Property Loan program intended for the investor borrower who cannot quite qualify for a conventional loan but is stronger and warrants better loan pricing than traditional hard money offers.

There could be several reasons that a borrower wouldn’t qualify for conventional financing (Fannie Mae/Freddie Mac), including:

Office Building Private Money Loan Financing

Most every blog and portfolio post on this site have been written about loans that we successfully closed. Not this one. Today we talk about a nearly $11,000,000 office building private money loan financing scenario that we lost out on by 25 basis points.

The buyers were seeking 24- to 36-month private money financing to acquire an office building in Southern California that was being renovated from a unique configuration designed for the seller’s business into a standard office building. Construction was scheduled to take another 5-6 months, possibly longer, as new tenants would require specific arrangements for...

Financing Options for California Cannabis Landlords

Throughout the past year, I received dozens of calls from commercial property owners who rent a portion or all their building out to cannabis-related businesses. They are seeking information about what kind of loan they’ll be able to refinance into after their existing bank loan matures and comes due in the near future.

First, a little background on real estate lending to cannabis businesses:

At present, and probably for the foreseeable future thanks to United States Attorney General Jeff Sessions’ recent public statements, banks cannot lend directly to a cannabis-related business for real estate purposes. Banks also cannot accept...

Hard Money Business Purpose HELOC

Believe it or not, there is such a thing as a hard money business purpose home equity line of credit (HELOC) available in California for residential and commercial properties. At First Capital Trust Deeds, we have closed a few of these loans over the past couple of months and continue receiving inquiries from self-employed real estate investors every month for the program.

The hard money HELOC program works just like a bank HELOC in that borrowers are able to draw upon the line of credit and pay down the balance at any time during the duration of the...

The Downside of House Flipping

In our business of originating hard money fix and flip financing on renovation projects, we frequently see some ugly houses that are either outdated or have been neglected for many years. However, it’s not often that we see some really, really bad cases in house flipping where the former homeowner lived for many years in a house infested with black mold and rats living in plain sight.

Recently we had a loan scenario in Oregon come to us where the former homeowner had been incapable of maintaining the home for many years and the living situation got out of control....

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