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Are You Paying Too Much for Your Real Estate Loans?

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Are You Paying Too Much for Your Real Estate Loans?

Hey there! Ever wonder if you’re paying too much for your real estate loans? It’s a common concern, especially with all the myths floating around about hard money being a wallet-drainer. But fear not, because we’ve got a nifty tool that can help you cut through the confusion and get a clear picture of what your loan will really cost you. Let’s dive in!

The Loan Cost Optimizer: Your Money-Saving Sidekick

Introducing the Loan Cost Optimizer! This handy tool takes the guesswork out of loan expenses by allowing you to compare costs and fees from different lenders. Think of it like a virtual cost calculator tailored specifically for real estate investors.

How It Works

  1. Input Your Costs:

    Start by plugging in your loan details, such as interest rates, loan duration, and any additional fees.

  2. Compare Your Options:

    The Loan Cost Optimizer crunches the numbers and presents you with a side-by-side comparison of different loan scenarios.

  3. Find Your Best Deal:

    Explore various loan options based on factors like project duration and required down payment to determine the most cost-effective choice for your needs.

Debunking Myths

There’s a misconception that hard money loans always come with exorbitant costs. However, our tool reveals that hard money isn’t always the priciest option. In fact, you might be surprised to find that it often stacks up favorably against other lenders, especially when considering factors like speed and flexibility.

Quality vs. Complexity

When it comes to choosing a lender, quality matters—but so does simplicity. While banks may offer perceived “higher quality” loans, they often come with a mountain of paperwork and stricter requirements. On the other hand, hard money lenders offer a streamlined process with fewer hoops to jump through, making them a viable option for many investors.

The Bottom Line

At the end of the day, what matters most is finding a loan that fits your needs and budget. The Loan Cost Optimizer empowers you to make informed decisions about your financing, helping you save both time and money in the long run.

Get Started Today!

Ready to take control of your loan costs? Head over to hardmoneymike.com to download the Loan Cost Optimizer for free. It’s easy to use, customizable to your specific project, and could potentially save you thousands of dollars. So why wait? Happy investing!

Watch our most recent video to find out more about: Are You Paying Too Much for Your Real Estate Loans?

Text "What is a credit score?"

How Is My Credit Score Calculated?

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Real estate investing gets a whole lot easier when you understand your credit score.

There are a couple different types of credit scores, but the numbers we’ll use here reflect FICO scores (the most widely used credit score for most lenders).

Credit scores range between 0 and 850. More than 740 is great, and a score of less than 700 begins to limit your options.

This number is calculated by looking at five main pieces of information:

  • Credit mix
  • New Credit
  • Credit History
  • Payment history
  • Amounts owed

Credit Mix

Close to 10% of your score is based on the mix of credit you already have.

Do you have seven credit cards?

Or zero?

Do you have a car payment, a mortgage, student loans, personal loans?

Typically, the more diverse your lines of credit are, the better it is for your score.

New Credit

Around 10% is based on “new credit,” or how often you get credit inquiries or open a new line of credit.

New credit can temporarily lower your score. So for example, if you buy a new car, you’ll probably have trouble securing a loan for a property right away.

Length of Credit History

About 15% of your score is calculated based on how long you’ve had your lines of credit.

If you opened your first line of credit less than 5 years ago, you’ll have a lower score than someone whose credit is 40 years old.

Amounts Owed

These last two categories are the most important. They make up two-thirds of your credit score.

About 30% of your score is determined by something called amounts owed. Amounts owed is about your debt. More specifically, it’s about how much of your available credit you’re using.

For example, let’s say your credit card has a max of $1,000. You buy a new set of tires and brakes, so now you owe $1,000 on your card. You’re using 100% of your $1,000 limit – you’re maxed out.

The story creditors see when they look at you is that you’re not managing your credit well. They’ll assume you won’t manage other loans well either, so you get a lower score.

But let’s look at another situation.

Say you got a different credit card with a max of $5,000. That same borrowed $1,000 has a way different effect on your credit score. You’re only using 20% of your credit line, and you’re leaving 80% at your disposal. Creditors like that story. So you get a higher score.

Payment History

The biggest amount of your score, up to 35%, is based on your payment history.

Payment history is exactly what it sounds like:

  • How are you paying your bills?
  • Do you always pay on time?
  • Have you had any bankruptcies?

Financial institutions can see this information, and it’s the top factor they consider. At the end of the day, lenders want to know: Will you pay them back? On time?

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