Investing in real estate properties can be very rewarding, you get to realize your vision and dreams in one property, and then when you get the hang of it, you can venture on towards bigger and more expensive properties to increases your profit margin. As with any business, there is always the need for growth and expansion into a diversified market. however, real-estate property investments cost a lot of money, and you should be able to make an offer for a property as fast as you can as it can be snatched by another investor with money to spend. Unless you have some secret account stashed somewhere, chances are you do not have that kind of money, and this is where bridge loans are useful and at times necessary.
These bridge loans allow you to purchase or acquire properties that serve as your investment, and hence will be able to generate income in the long run. When you invest in a property, you do so because you want to make it into a business enterprise and earn money from it, you do not buy a property just because it is quaint, pretty, or has a sentimental value for you. The bottom line is that your investment should realize returns or profits so that you can buy more properties and have a huge earning potential for all those properties. These loan providers operate in the New Jersey area and if you have found a property that you believe can be transformed into something livable, attractive, comfortable, and decent for tenants in the area, then go get that bridge loan.
Bridge loans are commercial loans and it is solely used for the acquisition or investment of real-estate properties and not for your home or private space. It needs to be rented or leased out so that you will be able to earn from the property. Read on to learn more about them and why you should apply for them.
Bridge Loans is Fast and Convenient
Your experience when you first purchased your home was a bit of a roller coaster and this is true for real-estate property acquisitions. You need to act fast or else, the property you have been dying to buy gets snatched right in front of you by someone who has the ready funds to make an offer. The usual source of funding for regular individuals who are just starting in the property investment business is bank loans.
However, if you have tried applying for a bank loan, you know that it is difficult for the loan application to be approved, banks generally are very cautious about extending loans for commercial purposes.
Bridge loans are offered by lending firms to help investors fund their property acquisitions in a faster and more convenient way than bank loans. These firms are direct lenders who can fund purchases of large-ticket properties like apartments, condominiums, hotels, and even parking lots in as little as a week and up to ten million dollars. You can even be pre-approved through the phone, and then come to the firm personally to sign the documents and papers.
The loan will be processed on the same day and approval is very fast. it will take a week for the money to be released and at times 2 weeks for those huge investments like ones that have a 10 million price tag. Moreover, their loan rates are at 8% and loan terms can be flexible, from less than a year to 3 years depending on the amount that was granted. Applying for a bank loan is very complicated with tons of requirements and the processing time takes months without an assurance that it will be approved. Hands down, bridge loans are better as they are more accessible and convenient.
These Loans Have Minimal Requirements
When you apply for a bridge loan, there are a few things you need to do so that your chances of getting approved are already guaranteed. First off is that you should be aware that bridge loans are commercial loans, and hence cannot be applied for by an individual. You need to be registered as an LLC to be able to do so. Do not worry, this is a very simple step that you can do online, and registering an LLC can be done the day you apply for the loan. Besides, the staff from the lending firms will assist you on how to do this. Then, the property that you intend to purchase must have earning potential. It would be better if it is priced below the market value so you will have enough funds to renovate or rehabilitate it, although it is not a requirement.
The lending firms are more interested in the earning potential of a property than its current state, so the lower the price, the better it is for you and the lending firm. You do not have to submit your credit rating or any other document as the lending firms do not care about them. They know that things happen and your credit score does not reflect your realities. So even if you have a poor credit score, you can still apply for a bridge loan.
Applying for Bridge Loans is Easy and Less Hassle
If the property you have been eyeing is recently available in the market with a great price and you already have a vision of what to do with the property to make it profitable but lack the funds to make an offer, then apply for a loan. Applying for a bridge loan is very easy, you can contact them through phone or email, and you can inquire about how to apply for a loan.
They will be happy to assist you in every step so you can be pre-approved on the phone. Then you can meet with your loan advisor and discuss your options and the loan rates and terms. If you are amenable to all, then your loan will be processed by a higher authority. After making the initial contact and submitting the required documents, all you need to do now is wait for the funds to be released.
