First Capital Trust Deeds provided Orange County investors with a quick cash-out hard money bridge loan to acquire another property.
One of the benefits of owning a free and clear rental property is that it can be used as collateral for a quick cash-out hard money bridge loan whenever the need arises. FCTD has done several loans for Southern California investors over the past few years. These investors used their free and clear rental property to access cash needed for a down payment on the acquisition of a distressed property.
We tend to see that after the new acquisition has been renovated, listed on the MLS, and resold, the hard money loan on the rental property that we originated gets paid-off in full. In theory and usually in practice, the money is out for about 6-8 months, benefiting both the borrower and hard money lender, or trust deed investor.
Most of our clients who utilize their free and clear rental properties are active house flippers, buying and selling 3-4 properties each year. Their rental property goes from being encumbered with a hard money loan to being paid in full to encumbered a couple times each year, all while they’re making a healthy profit flipping houses.
Cash-Out Hard Money Bridge Loan Terms:
- $250,000 Loan Amount
- 11.00% Interest-Only
- $2,291/Month Payment
- 12-Month Term
- No Prepayment Penalty