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How to Find Fix and Flip Deals

March 31, 2023 Hard Money Lender Leave a comment

How to Find Fix and Flip Deals

Fix and flip investing has long been a popular strategy for real estate investors for good reason. Done well, a fix and flip project can result in a sizeable profit margin. Whilst the renovation itself can go a long way to making you a tidy profit, the success of your project starts before that. One of the most important keys to success when flipping a property is how good of a deal you secured when you first purchased the property. As it stands, finding the most promising fixer uppers can also be the most difficult part of the project.

So where are the best places to look? Here are our top eight tips for finding a house to fix and flip.

1. Get to know the MLS. The Multiple Listing Service is a database that lists all properties for sale within a geographic area. The MLS is an easy way to find a property, no matter where you are, however it is only available to licensed realtors and attracts a monthly access fee. A pro tip when searching the MLS is to take note on how long the property has been listed for. If a property has been listed for a long time, the seller might be more eager to get rid of it, and will therefore consider lower offers. You may also find an expired listing that could present a great deal.

2. Conduct some online sleuthing. You may not be aware that sellers are allowed to post their properties on sites such as Zillow and Trulia before listing on the MLS. Therefore, an online search of classified sites might lead you to an off-market listing.

3. Scour public records. You could also search through government websites, courthouse records and local newspapers which may contain information regarding pre-foreclosures as well as short sales.

4. Network far and wide. Networking can go a long way to helping you secure deals, and there are many different people you should be networking with. For starters, you should network with real estate agents and attorneys in the areas you want to invest. They may be aware of off-market properties in your area and can give you a heads up if something promising comes along. To get started, ask your existing connections or attend local real estate meetings. You should also form relationships with contractors and builders who may possess a lot of knowledge on current property listings. Whenever you start work with someone new, make sure they know your goals and give them your contact information so they can reach out if they come across a potential deal. Additionally, it may pay to speak to people in the neighborhood you intend to invest and let them know what you’re looking for – you never know who might be the best direct private money lender to help you How to Find Fix and Flip Deals.

5. Market yourself online. You could promote yourself online with something as simple as your own website. Motivated sellers may be able to find you through your website and get in touch to let you know what they have on offer. Creating your own website can be easily done through platforms like Wix, Squarespace and WordPress. You could also create social media profiles on Facebook, Twitter or Instagram.

6. Run a direct mail marketing campaign. Another way to market yourself is through direct mail. To do this effectively, you’ll need to do some research into your target audience and who you intend to contact. For example, you could get in touch with owners whose listings have expired but houses haven’t sold, or with the owners of unoccupied homes.

7. Attend county courthouse auctions. Foreclosed properties can be auctioned off at county courthouses, so you may be able to find a good deal by attending county courthouse auctions. Be sure to do your homework before you go.

8. Partner with an agent. Working with an agent can be a great way to find houses to flip faster. Agents know the best places to look and are kept in the loop on available properties. They can also offer real estate investment advice based on their knowledge of the market. For an even more efficient way to find rehab properties, choose a real estate agent that specializes in real estate owned properties. REO properties are held by lenders or guarantors after a defaulted loan. These homes most likely weren’t taken good care of, and therefore are perfect for renovating and can be snapped up at lower purchase prices. It is also worth making sure whichever realtor you partner with has access to the MLS.

Whatever you’re looking for, there are many different places and ways to find a property worth flipping. If you’re ready to start looking for the top fix and flip hard money lenders nationwide, choose the right financing with RehabLend. Get in touch now

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Fix and Flip Trends 2023

March 15, 2023 Hard Money Lender Leave a comment

Fix and Flip Trends 2023

2021 and 2022 were particularly great years for flipping houses but have the tables turned? We’re facing higher interest rates, inflation, and a possible recession, making things look a little bit grimmer in 2023. However, there are still plenty of opportunities for fix and flip investors in the year ahead. Here’s what the experts want you to know.

2023 may see tighter profit margins for fix and flip investors
Unfortunately, a number of factors could lead to smaller profit margins in 2023. This includes:

Increased cost of construction materials. Over the past few years, we saw a huge increase in the cost of construction materials. Though these have started to decline – particularly the costs of lumber – prices remain elevated, adding to the costs involved in renovation and rehab projects.
Lower inventory and higher prices. Increasing mortgage rates and higher house prices mean people are reluctant to sell, and therefore there are less opportunities to purchase fixer upper properties. It also means it is harder to find properties with the potential to net a decent profit.

Despite this not-so-sunny outlook, with careful planning, the right purchase and a cost-effective fix and flip loan, you can still see yourself making a profit from flipping property this year. Choosing the right loan and planning ahead can maximize your investment and ensure flipping property is worth your while.

Foreclosure levels will continue rise
According to ATTOM, foreclosure filings increased 64% by the end of 2022, with the States of Texas, California and Florida hit the hardest. With a recession on the horizon, unemployment will likely increase and therefore foreclosure rates will continue to rise. For fix and flippers, this could lead to more inventory to choose from. However, investing in foreclosed properties is complex and only recommended for seasoned investors with a strong understanding of the process.

Rental prices will continue to increase
With rising house prices and increasing mortgage rates, many prospective homebuyers are choosing to rent instead. This has resulted in increasing rental prices, which are predicted to carry on rising. This means 2023 could be a great time to employ the BRRRR method. BRRRR (Buy, Rehab, Rent, Refinance, Repeat) involves purchasing and rehabilitating a distressed property, then renting it out and refinancing to start the process again with another property. With increased rental prices, this method may see a huge influx of passive income and the ability to carry on investing without a huge outlay of capital.

Technology will continue to open doors for fix and flip investors.
There are many ways technology is making it easier for fix and flip investors to find opportunities for a successful investment. For example, technology means you can view and inspect properties online, allowing you to search for deals across the country without ever leaving your home. Technology also means the process is much faster with reduced paperwork and processing times, allowing you to snap up a deal quickly.

So how can you make the most of fix and flipping in 2023?

Do your research. Markets vary widely across the country, as do the costs involved in flipping a home. Make sure you do your research, shop around and have a solid understanding of the market you’re investing in – and the costs you’ll incur along the way.
Choose the right lender. Not all fix-and-flip lenders are the same and it’s important to partner with someone who understands your goals and can work with you to achieve them.

If you’re ready to make a move in the fix and flip investment market, get in touch with RehabLend today. We can help with a cost-effective rehab loan tailored to your strategy and designed to optimize your investment.
This article is intended as a general guide and should not be considered as advice.

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Best Fix and Flip Lenders

November 21, 2022 Hard Money Lender Leave a comment

How to Choose the Best Fix and Flip Lenders

If you’re looking for a short-term loan for flipping houses, whether it’s a multifamily rehab loan, an apartment rehab loan or a rehab loan for an investment property, choosing the right direct hard money lender is crucial. There’s no shortage of hard money lenders for fix and flip projects, however, you want to choose one that offers the best terms for your unique needs, while also genuinely caring about your project and its success.

So, what do you need to look for in a hard money fix and flip lender and what questions should you ask to ensure you’re securing the best fix and flip lenders terms?

RATES AND FEES

One of the most obvious things to look for when choosing a hard money lender for fix and flip investments is what their rates are. Generally, the rates of a hard money fix and flip loan will be higher than traditional mortgages from conventional financial institutions like banks, however, if you shop around you’ll be able to find attractive options.

Don’t forget to ask what fees you’ll incur. Most lenders charge fees at various stages of the loan and these need to be factored into your budgeting.

REPAYMENT TERMS

Another thing to consider when looking for the best fix and flip lenders are their repayment terms. For instance:

Do they offer interest and principal repayments, or interest-only?
Will the lender allow you to pay off the loan early without incurring a penalty?
What are your options if the rehab takes longer than expected?

Also, consider if the fix and flip hard money lender’s terms are constant. You have enough to worry about without dealing with a lender whose terms change with the economy.

APPLICATION PROCESS

Unlike traditional financial institutions like banks, hard money lenders generally have easier and faster application processes that require a lot less paperwork. Many even allow you to complete your application process online. Ask your potential hard money lender for flipping houses how their application process works and see how it compares to other lenders.

Also, consider what is required to apply and qualify before you settle on a lender. Most fix and flip lenders focus on the property you intend to use as collateral or the deal you’re proposing, however, others may want to see your credit score, tax returns, and other assets.

CLOSING TIMES

Generally, the major drawcard for hard money rehab loans is how fast they can be closed. Be sure to ask a prospective hard money fix and flip lender how quickly they close their loans.

Some commercial rehab lenders offer extremely short closing times – some in as little as days. However, you need to be aware that this is dependent on you getting your documents in quickly and responding quickly if any additional information is required.

Additionally, not all lenders with short closing times offer this in their fix and flip loans for beginners, so don’t get swayed by short closing times before checking the fine print.

DOWN PAYMENT

Some fix and flip hard money lenders require a down payment of up to 20%, however, others offer hard money rehab loans with a 0% down payment. Again, this can depend on your experience and circumstances, so be sure to check what applies to you.

WHAT THE LOAN ACTUALLY COVERS

Some hard money lenders for flipping houses offer financing for the purchase price as well as the renovation or rehab costs. If financing the rehab of your investment is something you require, be sure to check that this is covered.

EXPERIENCE

Choosing a lender with vast experience can make all the difference. Additionally, if you’re working with a lender who has been around a long time, chances are they’ve weathered several recessions and will be able to help you through tough times in the future too.

Questions you could ask to determine just how experienced the fix and flip hard money lender is could include:

How many hard money rehab loans have you issued?
Do you have experience fixing and flipping properties yourselves, or do you deal with finance only?
How do you underwrite your loans?

VERSATILITY

If you’re planning on flipping projects in the long-term, consider partnering with a fix and flip lender who offers the versatility to work across multiple projects. This includes the ability to fund varying sums of money, as well as the ability to fund the purchase and renovation of various property types such as multifamily, mixed-use and commercial properties. Additionally, not all fix and flip lenders can offer investment property rehab loans in every State. If you’re planning to invest in a different state to the location of a hard money rehab lender, or intend to invest in multiple states, it’s worth asking what areas the lender in question can serve. Working with one lender on multiple projects, as opposed to sourcing different lenders in different regions, is a good way to build a long-term relationship that will ensure better rates, terms, and availability of financing.

The last thing to consider is what your priorities are. Is it a fast-closing commercial rehab loan or the cheapest possible rates? Are you looking to build a long-term relationship with a lender, or just want someone who can help you with a one-off investment opportunity?

Whatever you’re looking for, Rehablend is one of the best fix and flip lenders in the country. We genuinely care about the success of your project and offer flexible bridge loans that can be tailored to your needs to ensure optimum ROI. To find out more or to see if our short-term loans for flipping houses are right for you, get in touch today.

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Fix and Flip Rehab Bridge Loans

September 29, 2022 Hard Money Lender Leave a comment

Commercial & Residential Bridge Loan Options for Property Types

When it comes to investing and rehabilitating real estate, what are your best options? It seems there are endless types of residential and commercial property to choose from, and knowing where is to start or where to look next can be overwhelming. Unfortunately, there is no one size fits all answer. Some of the best rehab fix and flip investors prefer residential single-family homes, others prefer Multifamily apartments or large-scale commercial buildings. You’ve probably heard that the best strategy when it comes to investing in property is to diversify your portfolio, but often the best strategy is to invest in markets you feel most comfortable with and understand the best. Working with a top private fix and flip hard money lender can ensure you are headed in the right direction. Also applying the best rehab fix and flip loan to fit the investment property is key! Short term bridge loans, commercial rehab loans, residential investment property private financing options are just a few.

Here we take a look at different property types and the various rehab loan options available to each of these property types. Including cash out refinance and Fix and Flip Rehab Bridge Loans

Single-Family Properties

Why invest: There are a number of reasons single-family homes are an appealing option for real estate investors, particularly people looking for a first-time fix and flip loan. Single-family properties are usually in constant demand, offering lower vacancy rates, immediate returns, positive cash flow, and long-term appreciation potential. They are also easier to manage since you’ll only need to worry about a single tenant and turnover occurs less frequently.

Fix and Flip Rehab Bridge Loans option for single-family homes: Generally, banks and traditional financial institutions will offer long-term financing for single-family properties, based on certain circumstances. These loans usually offer enticing rates; however, they can take a long time to close and they require strict conditions to be met. You’ll be required to put down a large down payment, and your credit history, income, and personal situation will be taken into account and weighed heavily. If you’re restricted by a deal that needs to close quickly or by a credit history that banks won’t approve of, an alternative option is working with a hard money lender. A hard money lender can offer a variety of financing solutions, such as a single-family bridge loan which will enable you to quickly purchase a single-family home while you raise a down payment or wait for more permanent long-term financing. Another option you could consider is using hard money to flip houses. A fix and flip hard money loan will enable you to purchase and renovate a single-family home, then sell for profit, or refinance with long-term financing and rent out to high-quality tenants.

2-4 Unit Multifamily Properties

Why invest: Investing in the right 2-4 unit property is a surefire way to boost your investment portfolio with lucrative returns. While they come at a higher cost than single-family homes, they are more affordable and require less management than larger multifamily dwellings. They also offer steady rental income and appreciation in value.

Options for finance: As with single-family homes, traditional financing is an option, however, it is more difficult to secure a long-term traditional loan for a 2-4 unit property due to the higher cost and higher risk. Again, a private rehab lender can help you secure fix and flip financing to flip a 2-4 unit property. From here, you have multiple options including renting out each individual unit, selling each individual unit, or selling the property as a whole. A 2-4 unit property bridge loan is another option enabling you to move quickly on a deal, while you wait for long-term financing.

Larger Multifamily Properties

Why invest: Multifamily properties have long been popular for investors for a number of reasons. For instance, homes within multifamily properties are generally in high demand thanks to their affordability, and occupancy rates tend to remain high and stable even during difficult times, such as the height of the COVID-19 pandemic. Additionally, real estate property investors are often attracted to the convenience of having multiple investment properties located within one place, making it easier and more efficient to deal with things like maintenance, repairs, and management. Multifamily bridge loans can apply to purchase, cash out refinance and rehabilitation. As a direct nationwide fix and flip private lender we can assist you in finding the best options to fir your specific scenarios criteria.

Options for purchase, cash out and multifamily rehab financing : As multifamily properties are larger again – generally between five and thirty homes – traditional long-term financing is even more difficult to secure. Banks will tend not to lend to people with no investment history or with bad credit, particularly if the property is in bad condition and therefore deemed a risky investment. Fortunately, you can find a hard money lender who will offer multifamily rehab fix and flip loans to people with bad credit, as well as fix and flip loans for beginners. Rehab financing will enable you to purchase and renovate a multifamily property in need of work, then complete this work before selling or renting out each unit. This strategy can see significant profit or high rental income potential. Alternatively, you could work with a hard money rehab lender to secure a bridge loan, giving you time to secure long-term financing or finalize your strategy to flip a multifamily property.

Townhomes

Why invest: Townhouses are multi-dwelling properties made up of several attached homes. They are an enticing option for real estate investors due to their low maintenance, increasing demand, and high likelihood of capital growth.

Options for finance: Purchasing a townhome property can be achieved with long-term financing. However, if you are looking to purchase a townhome in need of significant repairs, traditional lenders may deem them too risky and refuse to provide finance. Opting instead for a townhome bridge loan or a fix and flip mortgage will enable you to complete the necessary works before securing a long-term non-owner-occupied loan and leasing out each townhome, or selling. Once your rehab is complete, you could sell each one individually to owners or investors, or sell the whole block to another investor.

Investing and rehabilitating loans for Condos

Why invest: As with purchasing a multifamily property, purchasing and rehabilitating a condo property is a huge undertaking that can reap significant rewards. Condos are often in high demand due to their affordability, meaning that you’ll be likely to receive a steady stream of rental income. Other benefits of investing in an apartment building include tax benefits, excellent appreciation in value, consolidated property management, and a fast-tracked investment portfolio.

Options for finance: Purchasing a condo unit is a large-scale project that comes with high risk. Accordingly, you may find it near impossible to secure long-term financing for a condo property with a traditional lender, especially if you are a beginner investor. Working with a top rehab lender, however, will give you options, regardless of your experience and credit history. A hard money lender will be more concerned with the potential of the property you are looking to invest in, and therefore you may be able to secure a condo bridge loan to get the purchase over the line, or condo fix and flip financing to rehabilitate the property and maximize your investment.

If you’re ready to take the next step, Rehab Lend is a top nationwide direct private money rehab lender for Fix and Flip Rehab Bridge Loans. We have extensive experience lending to investors in the fix and flip commercial rehabilitation market. We can help you with fix and flip loans tailored to suit your needs and the property type you are looking to invest in. Contact us now and speak to one of our senior loan experts today.