If you’re currently in the process of buying a home that you plan to flip, you are probably also in the process of figuring out how to finance your new project. If you’re interested in a private money loan but are unsure of what it is and how it can benefit you, here is some more information.
What Are Private Money Lenders?
A private money lender is a loan from an individual or private organization as opposed to a typical bank. Private money loans have fewer regulations placed on them and can therefore offer more flexibility for both the lender and borrower. There are still certain qualifications that a borrower will need to meet, but those qualifications are dependent on the private money lenders and their requirements.
What Are the Benefits of Private Money Loans?
Private money lenders can fund loans quickly and with much less paperwork than traditional lenders require. Traditional lenders take weeks and sometimes months to fund loans, private lenders can close in weeks and even days. If the borrower, investor/flipper has less poor credit private lenders, do not care as much about credit as do traditional lenders.
Private lenders are not as critical about the property’s condition, where traditional lenders do care about the condition of the property.
Most experienced flippers use cash or private money to purchase their flip properties. It is unusual that a flipper will use a traditional lender, bank or mortgage company to fund the purchase of a flip.
Is a Private Money Loan the Right For You?
Most experienced flippers use cash or private money to purchase their flips. If you are serious about getting into the flip business and don’t have a lot of cash, private money will be your next best source to buy your flip.
GW Private Capital is a great source for private money flip loans. Call us to learn more about how private money loans work, what the costs and terms are of these mortgages.