Fixing and flipping property is one of the easiest ways for investor to make money. This strategy entails buying property such as a condominium unit or a house, fixing it up, then selling it again. Of course, one will be needing some fix and flip real estate funding to do that so here are some of the best options that one can consider if he or she plans to do this.
The most popular way to finance this kind of venture is through a hard money loan. The happens to be a very good way of financing this sort of project because it is a short term loan that is easy to get. In fact, it is perfect for those who only plan to do up the property in a year and sell it off as soon as possible.
One of the best benefits about hard money loans is that they have a very fast processing time. In fact, it is completely possible to get the loan just right after fifteen days from the application date most likely since the term would be only one to three years. Take note though, that the interest rate is quite high being up to twelve percent depending on who lends.
To acquire this type of loan though, one will need to present his or her credit score, experience in flipping, and debt to income ratio. First, a credit score of a minimum of five hundred and fifty is needed with a debt to income ratio of thirty five percent at least. Finally, two to three years experience is needed in flipping properties.
Another type of option is known as the equity line of credit wherein there is the home line of credit and property line of credit. The home line is a type of long term credit line that is fixed while the property line of credit is based on the loan amount. In a nutshell, it works like a credit card but used for a term period and for the fixing and flipping of the property.
The home equity credit takes around a month or a bit more to get the money. The interest, on the other hand, can be as low as four percent but high as five. In order to get this loan, one has to have a credit rating of six hundred and forty at least with an income debt rate of forty percent and existing ownership of property.
For the property credit line, the term loan would be around two years with a thirty days approval. As for the interest, it can be five percent up to eight percent. The requirements are similar to the home credit line except the figures are a little bit higher since this short term loan would be a little more high risk than the home credit.
These are some of the best options that one can try out if he or she is interested in engaging in fixing and flipping of property. These loans are very easy to acquire if one has all the requirements. As long as he or she knows how to manage risk, he or she should have no problem.
The most popular way to finance this kind of venture is through a hard money loan. The happens to be a very good way of financing this sort of project because it is a short term loan that is easy to get. In fact, it is perfect for those who only plan to do up the property in a year and sell it off as soon as possible.
One of the best benefits about hard money loans is that they have a very fast processing time. In fact, it is completely possible to get the loan just right after fifteen days from the application date most likely since the term would be only one to three years. Take note though, that the interest rate is quite high being up to twelve percent depending on who lends.
To acquire this type of loan though, one will need to present his or her credit score, experience in flipping, and debt to income ratio. First, a credit score of a minimum of five hundred and fifty is needed with a debt to income ratio of thirty five percent at least. Finally, two to three years experience is needed in flipping properties.
Another type of option is known as the equity line of credit wherein there is the home line of credit and property line of credit. The home line is a type of long term credit line that is fixed while the property line of credit is based on the loan amount. In a nutshell, it works like a credit card but used for a term period and for the fixing and flipping of the property.
The home equity credit takes around a month or a bit more to get the money. The interest, on the other hand, can be as low as four percent but high as five. In order to get this loan, one has to have a credit rating of six hundred and forty at least with an income debt rate of forty percent and existing ownership of property.
For the property credit line, the term loan would be around two years with a thirty days approval. As for the interest, it can be five percent up to eight percent. The requirements are similar to the home credit line except the figures are a little bit higher since this short term loan would be a little more high risk than the home credit.
These are some of the best options that one can try out if he or she is interested in engaging in fixing and flipping of property. These loans are very easy to acquire if one has all the requirements. As long as he or she knows how to manage risk, he or she should have no problem.
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