Bridge Loans 2024: Real Estate Investing Must-Know
Bridge Loans 2024: Real Estate Investing Must-Know
Investors wonder what a bridge loan is and how it can help them achieve their real estate investing goals. Today we will discuss bridge loans and what every real estate investor needs to know before jumping in. To clarify, a bridge loan is a short term need for money until some other event happens. This includes selling a property, refinancing a property, and so much more! Start by asking yourself what you can use the money for and how can you make money?
Bridge loans for usage loan.
A usage loan is needed when someone has too much debt on their personal credit cards. Once these cards are paid off, the investors credit score will increase. We did three usages loans last month! For example, one customer used a bridge loan to pay off their credit cards. After their credit score went up, they refinanced with a DSCR. The money from the refinance was used to pay off credit cards. Bridge loans are an excellent tools that will open doors that were previously closed. They will also provide opportunities to get a better rates on long term loans.
Bridge loans for fix and flips.
Bridge loans are a great way to bridge the gap between fix and flip projects. It is important that they keep their crews working and their business going during this transition. In regards to the property that is listed or getting ready to list, it holds the equity that is needed to move onto the next investment. That is where a bridge loan can help. It puts a lean on the property that you’re selling in order to help you buy the next property. Once the property sells, the bridge loan can then be paid off and your next project is helping you to move forward.
Bridge loans to finish a project.
Investors often need additional funds in order to finish projects. This could include a pop top, scraping, construction loan, or even a fix and flip. Whether the escrow won’t pay out until you hit a certain amount, or you just ran out of money, a bridge loan can help you achieve whatever you need.Once again, a bridge loan is a short term solution to get investors onto the next step. Don’t let your property stall! Remember you still have to pay your contractors, laborers, taxes, insurance, and interest on the first mortgage. We have done bridge loans for $11K to $180K. The loan amount is based on what the property will be worth in the end. Do you need to finish a project before spring season, but don’t have the extra money? Contact us today to find out more!
Bridge loans to buy a good deal quickly.
Many investors use a bridge loan to help them buy a property that is a really good deal prior to getting the financing lined up, or delayed purchase financing. In most cases investors are not getting their finances secured before the hard close date. Here at Hard Money Mike we can come in and do a 3 month bridge loan to ensure that they won’t lose the property. In this situation, a bridge loan would allow them to secure the property until they get their financing in order.
Not your traditional loan.
Unlike traditional lenders, we are not looking for appraisals or asking you to validate your income. A bridge loan’s primary purpose is to fill a lending gap to get you to a better spot. Don’t confuse this loan with a DSCR loan. A DSCR loan is a 30 year fixed loan, however, a bridge loan is a 3 to 6 month term. Do you need gap funding or down payment money for your next project? Find out how a bridge loan can provide the funding you need without needing to find a partner. Instead, we can use the other properties you have to get the bridge loan that you need.
We are here for you!
Do you need financial flexibility and a loan that can bridge the lending gap? A bridge loan could help you today! Contact us at Hard Money Mike to find out more!
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