Leveraging private money loans for fix and flip projects is the hottest thing going in real estate investing. Loans for fix and flip investments are in high demand for properties in Albuquerque, Rio Rancho and Santa Fe; however, most banks won’t approve financing.
Do you have the perfect property in mind for your fix and flip investment but aren’t sure how to make the financing work? Here are several tips to get your fix and flip project off the ground and make sure that you’ve got a profitable exit strategy by leveraging affordable private money loans.
Fix and Flip in New Mexico Can Be a Great Money Maker
Fix and flip projects were all the rage before the housing bubble burst and now that the recovery is in full swing the opportunity to profit from these investments is back. There is more to turning a profit with your fix and flip investment than fixing some drywall or planting flowerbeds. You need access to affordable financing and have a comprehensive exit strategy for flipping the property.
The problem with financing fix and flip projects is that most banks won’t touch these properties until after the repairs are made, a catch 22 for most investors. That’s where interim financing with a private money loan can get your fix and flip project funded using a bridge loan. This allows you time and capital to get your property up to snuff for a bank loan if you need it or to simply flip the property for a profit.
It goes without saying the less you pay for your bridge loan the more you’ll profit when it’s time to flip the property. Most hard money lenders want upwards of 12 points and 12 percent (or more) for you to get your hands on a private bridge loan.
You’ll find that the people arranging private money loans in Albuquerque and Santa Fe are often shady, unprofessional people that you wouldn’t want to meet socially.
There’s a Better Way to Finance Your Fix and Flip Real Estate
The problem with financing your fix and flip project with most private money lenders is the fees they overcharge. If you pay 12 points to get your private money loan most of your profit goes down to drain to that shady lender. Remember that one point is one percent of the loan amount and most private money lenders roll their fees into your loan amount.
Here are five tips to help get your fix and flip project funded without having your profits swallowed up by unnecessary points and fees.
- Learn As Much As You Can About Your Local Real Estate Market
- Treat Your Fix & Flip Project Like a Business
- Decide How You’re Going to Pay For The Property
- Profiting From Fix and Flip is About Leveraging Relationships
- Develop a Clear Exit Strategy for Flipping Your Property
Talk to realtors and mortgage brokers about your local market and the neighborhoods where you’re planning on investing. Property values vary widely from one neighborhood to the next in Santa Fe and Albuquerque so you need to know where the most profitable homes are located.
Flipping real estate for a profit is a time consuming project. Treat it like a business and project a professional image and you’ll find that real estate agents, bankers, and contractors are more likely to take you seriously.
You might think that paying cash for the property is the best strategy. You’d be surprised how many moguls like Donald Trump won’t risk their own cash in real estate investing. Fix and flip investing is a gamble. Even if you’ve got the cash to pay for fix and flip real estate in Albuquerque or Santa Fe, leveraging affordable private money loan lowers your risk and won’t tie up your cash.
Do you want the inside scoop on the most profitable fix and flip properties in Albuquerque and Rio Rancho? You need to establish a relationship with a good realtor. Want affordable financing to get your fix and flip project off the ground? You need a trustworthy private money lender that won’t steal your profits by charging outrageous fees.
There’s a handful of private mortgage lenders in Albuquerque and Santa Fe and nearly all of them charge 12 points or more to get a private money loan funded. Paying this much is not only unnecessary but quite frankly it’s ridiculous.
If you want to profit from your fix and flip project in New Mexico you need a solid plan with an exit strategy. How are you going to repair the property once you’ve got it without going over budget? Once the seller accepts your offer and you get the financing in place the real work begins. Do you have an exit strategy for flipping New Mexico real estate? What if you’re stuck making payments on a bridge loan in a soft market?
The great thing about securing financing from Private Money Loans New Mexico is that not only can you get affordable financing without paying outrageous fees, Tim will make sure you have a attainable and profitable exit strategy for the property you’re flipping. Tim has 20 years’ experience financing real estate in Albuquerque, Rio Ranch and Santa Fe. He knows the local market and knows how to make fix and flip profitable.
Remember how profiting with fix and flip investments is all about leveraging relationships? Tim is the private money lender you want in your corner when that dream property comes along.
Do you want to learn more about profiting from fix and flip real estate investing in New Mexico? Contact Tim Wilson to learn how affordable private money loans can get your project funded with a winning exit strategy for your fix and flip investment.