Choosing the best loans for your projects and investments can be a daunting task. Many investors would jump at a bank loan as a trusted alternative without realizing private loans may provide a plethora of benefits. While bank loans may offer lower rates than private institutions, they usually subject applications to lengthy underwriting processes that prove counterproductive for quick investment strategies (e.g., fix-and-flip real estate).
Additionally, bank loan processes may include a detailed review of your global income, alongside a substantial down payment preference. These prerequisites may lead to complications with the application and affect the chances of a loan. By entrusting a private lender like Lendmarq, you can look forward to multiple perks and a more seamless application.
Fixing and Flipping Real Estate
You’ll need various factors in a flipping venture. These include the property’s purchase price, rehab costs, realtor/closing costs, target sales price, and the other costs required to hold property (e.g., payments, insurance) before the sale.
Most banks will not consider your experience as a flipper while approving a loan. Instead, they will undertake strict measures to ensure your ability to repay the loan whether or not you are successful in executing your flip.
Alternatively, Lendmarq works closely with you from the beginning to determine the best rates according to your flipping experience. Our rates begin at 6.99%, and we focus on the property itself and your chances of success, rather than your ability to repay the loan, assuming you are not successful. Lendmarq’s flexible leverage ensures that you can start getting funded and investing without delay.
Building Spec Homes
Very much like fix and flip loans, banks do not like spec construction lending unless you are an institutional-quality builder like Toll Brothers or Lenar. If banks approve you for spec construction loans, the required cash contributions to the project are substantial, most likely not to exceed 70% of the total project costs. If you don’t have a relationship with that bank, it will be tough to move your deposit relationship to that bank, which takes time and energy to focus on the project itself.
Lendmarq finances up to 85% of the total project costs for spec construction. Allowing our borrowers to preserve cash and obtain more deals. Many spec builders are very focused on interest rates. They will compare a sample bank rate of 4.75% to a possible Lendmarq rate of 8% for spec construction and think it is an easy decision. It might be if you want only to do one deal a year or now and then since the bank will firmly focus on your ability to carry the amortized payments for 15 years. This is assuming you will fail in the sale and will have to refinance and hold on to the property.
However, if you are looking to scale your building, every little bit of cash helps, and Lendmarq’s efficient financing might allow for 2, 3, 5, or many builds per year. That 8% rate then unlocks investment returns well in excess that the 4.75% rate would yield.
Long Term Rental Loans
Banks offer investment real estate loans with differing terms and conditions as they might offer Fannie Mae / Freddie Mac financing (in your personal name) or a commercial loan structure. The underwriting standards are challenging and time-consuming, and your tax returns better are in perfect order.
Lendmarq offers 30 year fixed rate loans as low as 3.75%, which is highly competitive, even compared to banks, and provides speed and efficiency that they cannot match. Need to close REALLY fast? Lendmarq can also do a short-term bridge loan in days, which allows you the flexibility not to lose the property if you find one that is too attractive to pass up. Again, we focus on the property itself and skip the global income calculations and tax returns.
At Lendmarq, we believe in fulfilling the evolving needs of flexible real estate investing. Consult with our team today to discover how we can help you secure the amount needed for your specific projects with minimal complications and delay.