Month: January 2020

Arizona Tel: (623) 582-4444

Texas Tel: (512) 516-1177

111 Congress Ave | Austin | Texas | 78701

About: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 43 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

If You Can Write a Listing, You Can Make Money with an Arizona Airbnb Loan

Taking out an Arizona Airbnb loan may seem like a risky prospect. However, it doesn’t take much beyond knowing how to post a listing to make money using the platform.

In the early days, peer-to-peer marketplaces for home-sharing and rentals were little more than couch-surfing sites. Born out of necessity due to market conditions, these sites thrived because homeowners needed to generate extra income to make ends meet and travelers needed less expensive accommodations. Ergo, most of the rentals listed were either a single room in an occupied home or just a sofa in someone’s Livingroom.

These options still exist, but as the market has improved, peer-to-peer rentals developed too. Nowadays, people not only rent out second homes, but purchase properties with the express intent of renting them out. Data from Savilles concludes the average second home brings the owner a cool $21,000 per year in rental income and most people use a mortgage or Arizona Airbnb loan to fund the initial purchase. Interestingly, the average home is rented out just 17 weeks per year as well, meaning you could easily use yours as a vacation home as well or increase marketing to improve your revenue stream. If you do the math, it works out to $1,235 per week or over $64k annually if you’re fully booked.

The catch: you need to select a property that will rent out and you need to market it well in order to increase your ROI. The good news is, Savilles also researched what people are looking for in their short-term rentals, so it’s easy to pick a place that will get booked and stay booked.

Match Expectations to the Property and You’ll Be Successful

Coastal locations, towns/ cities, and mountains are your best bets as you shop for a property, according to Savilles, and your guests will prefer detached villas/ homes, apartments, and townhomes, in that order. Guests also look for basic features, such as broadband internet and air conditioning while booking, and if you’re in a coastal area, they want easy access to the beach. If your property doesn’t already have special features, it may be worthwhile to use your Arizona Airbnb loan to add them, so demand for your property increases. Not all features will give you ROI, though, so spend wisely. For example, guests aren’t generally looking for golf courses, marinas, and access to water sports, nor are they over-eager about sports facilities, gyms, extra land, and home automation systems. That’s not to say these features aren’t beneficial, but they aren’t as likely to increase your bookings or allow you to charge more as cultural activities and good parking.

You’ll make readers eager and increase ROI by highlighting the best features in your ads.

The secret to making money with an Arizona Airbnb loan is to keep your space rented out and get the most from each rental. Spend time crafting the perfect ad that demonstrates which features the property has as well as its proximity to local attractions and transit. Be sure to include photos and experiment with the wording. When the property starts off with good features, generating income with it is nothing more than good writing skills.

Dennis Dahlberg

Broker/RI/CEO/MLO

Level 4 Funding LLC

Arizona Tel: (623) 582-4444

Texas Tel: (512) 516-1177

111 Congress Ave | Austin | Texas | 78701

Why Fix and Flip Loans in Arizona are Awesome for REOs

REO properties make great investments, but financing the purchase can be a challenge. Fix and Flip Loans in Arizona work especially well for REO purchases because they eliminate barriers.

As you search through property listings, chances are you’ll see the term “REO” quite a bit. It appears on listings for both investment properties and consumer properties, and references that the home is “real estate owned.” In short, the bank owns it, not a person.

Properties become known as REOs when the homeowner defaults on the mortgage and a foreclosure occurs. People wind up in foreclosure for many reasons, and the banks don’t like to take homes away from people, so the homeowner gets a chance to make things right during a pre-foreclosure process. During this phase, the homeowner can either get his mortgage caught back up or sell the property. Banks will even sometimes allow the homeowner to sell the property for less than they owe on their mortgage just to be done with the whole thing. If the homeowner does nothing, then the property will go to auction. Many investors use Fix and Flip Loans in Arizona at auctions as well, purely because they’re usually cash-only, meaning the buyer can’t try to apply for a mortgage after. He has to be able to pay for the purchase right away. If a property doesn’t sell at auction, then the bank takes ownership of it and it becomes known as a REO.

Naturally, banks aren’t in the home-selling business, so it’s their goal to unload the property as quickly as possible. Additionally, REO properties tend to be in disrepair, simply because the initial mortgage-holder is often unable to handle maintenance on the property for some time prior to defaulting on the mortgage. The foreclosure process takes months to complete too, increasing the timeline proper care hasn’t been given to the home. Because of these things, REOs can often be purchased fairly inexpensively.

One of the Pitfalls of REO Properties is that Banks Financing May Be Out

Regardless of whether you’re an investor or an average person looking for a new home, the banks may turn up their noses at your REO property. This usually happens when it’s in ill repair, but things like your credit and whether or not you plan to live in the home matter too. That doesn’t mean you can’t or shouldn’t purchase the REO, particularly if you’re getting a screaming deal on it, only that Fix and Flip Loans in Arizona may be better-suited to the job than a conventional mortgage.

Hard money can get you into a REO when the banks won’t.

Hard money Fix and Flip Loans in Arizona work differently than mortgages. You’ll typically take the money out for a short period of time; such as a few months or a couple of years. During that time, you’ll make interest-only payments and then pay off the balance at the end of your term. Things like the condition of the property and your credit are less of a concern, but you’ll need to have detailed plans for how you’ll repair the REO and know when/ how you’ll pay off the balance. If you plan to live in the home and the initial condition of it prevented you from getting a traditional mortgage, you should be able to qualify once the repairs are complete. If you’re a rehabber who likes to repair and sell, you’d pay off the balance as soon as the property is sold. In other words, don’t let the term “REO” scare you away from a property. Instead, research it well and explore alternative lending with a broker. You just might find you’re getting the deal of your dreams.

Dennis Dahlberg

Broker/RI/CEO/MLO

Level 4 Funding LLC

Arizona Tel: (623) 582-4444

Texas Tel: (512) 516-1177

111 Congress Ave | Austin | Texas | 78701

Trust Deed Investing—What are the Advantages? The Pitfalls?

Is this method of funding one you should take on? Again, do the needed research and find out what is best for your planned investment because these are different from most well-known funding packages.
These investments, if done correctly, can give a well-defined yield with the investor’s risk being a low one. Single digit returns, as high as 10 percent, can be registered on a monthly basis here.

Safety margins—the difference between the value of property and the total amount of the loan—border the possibility of loss in this kind of investing. Failure to repay funding by the borrower can result in the lender’s re-possessing the property in order to regain any losses along with any interest that may have been attached to the loan. Investments can have a LtV (Loan-to-Value) up to 65 percent, which is certainly a positive point for a borrower.

Trust deed investments do not, however, appreciate in their value as do typical real estate investment properties. Still, income can be generated by them.

Banks, on the whole, typically do not want to do this type investing since they are looking to make as much money as possible from their loans—six to 12-month payoff times do absolutely nothing for these institutions. The banking industry’s loans are set to expand over a lengthy time period up to and including 30 years in more than a few instances.

Lawsuits involving the property title, real estate values that drop suddenly and sharply, assessment errors made and overlooked during appraisal that change the property value are just some of the things that make this type investing termed as somewhat dangerous to both borrower and lender.

Traditional investors want solid ground under their feet at all times and the rules they work by are designed to make that as close to reality as possible. Investors that are in the ‘hard money’ areas are thought to be a better choice for trust deed investing since they can and do work outside the regular boundaries of investing. They also charge higher rates of interest and origination fees than conventional lenders.

Deep study and careful consideration of all factors is a must when it comes to this type investment—after all you want to make money, not lose it. Be assured that all the desired legal demands have been met and double checked, and that the property appraisal is correct to the last penny. Be certain of the whole as well as the sum of the details. These investments cannot be converted back into liquid cash in a couple of weeks if you have a change of mind as can bonds or blue-chip stocks.

If you are seriously interested in trust deed investing, however, along with your regular research, talk to an attorney or a certified public accountant whose opinion you value. If you have friends in the business, check with them as well. Once you possess all the facts, if you still want to invest in this area, find the lender who is best for you and work with them to make your experience a positive one.

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC
Hard Money Lender
Hard Money Loans
Hard Money Loan
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis
Dennis Dahlberg Broker/RI/CEO

Why Banks Don’t Like to Give Loans to Flip Houses in Arizona (And What You Can Do About It)

Going to banks for Loans to Flip Houses in Arizona usually results in a big fat “DENIED” letter. The good news is, there are other ways to increase your eligibility for funding.

Working on fix-and-flips can increase your wealth dramatically, especially if you’re already handy or have some experience in real estate or finance. However, getting your hands on financing, particularly for your first few properties, is a real challenge because traditional financing doesn’t work. Banks will typically tell you “no” for one of three reasons;

1. You’re not living in the home. Banks like owner-occupied homes because the person making the payments obviously needs a place to live. In other words, you’d move mountains to keep your home, no matter what else happens in your life. If you’re not living there, the bank will likely consider offering any kind of cash too risky.

2. The property is not in good repair. Some of the best fix-and-flip deals have serious issues, like roof or structural damage. They can’t be lived in because of this. If the bank were to give you Loans to Flip Houses in Arizona and you didn’t make good on payments or fix it, they’d be stuck with an unlivable house that they’d have to fix before unloading. It’s an expensive and undesirable situation for them.

3. Your credit isn’t spectacular and you don’t have business credit yet. It takes small businesses quite some time to establish credit, especially if you’re asking for tens of thousands or hundreds of thousands of dollars. In most industries, the business owner uses his or her personal credit until the business is established, but most people don’t have strong enough credit to cover the large amounts of cash needed for purchasing a property. If you already have a mortgage for your own home, that’s a double ding. They’ll be looking at it from the standpoint of making two mortgage payments; something most people cannot do.

Increase Your Eligibility by Choosing Alternative Funding

Banks aren’t the only ones you can go to when you need Loans to Flip Houses in Arizona. Oftentimes, people in the industry go with hard money instead. This refers to financing based on the value of an asset, rather than the criteria banks usually use. It’s easier to get and it doesn’t matter if the house is a wreck or if your credit is rotten. You’ll also hear it referred to as private money, simply because the people financing your project are regular people versus institutions or banks.

A seasoned broker can help make your dreams come true.

It probably goes without saying, but private individuals with cash to invest don’t hang around street corners asking people if they need cash. To get Loans to Flip Houses in Arizona with great terms, you’ll need to work with a broker who is familiar with multiple investors and can match you with someone who’s a good fit for your project. A seasoned broker will also help you shore up your plan if need be, so the deal looks good to investors and you have more success with your rehab projects. Whether you’re just looking for info or already have a property picked out, speak with a broker who works with hard money and you’ll increase your chances of getting approved dramatically.

Dennis Dahlberg

Broker/RI/CEO/MLO

Level 4 Funding LLC

Arizona Tel: (623) 582-4444

Texas Tel: (512) 516-1177

111 Congress Ave | Austin | Texas | 78701

Why Few 100 LTV Arizona Hard Money Lenders Exist (And What You Can Do About It)

If you’re looking for 100 LTV hard money lenders, you’re likely to find few, if any, options. The good news is, there are still ways to fully-fund your real estate investments if you’re savvy.

Before the big market crash, people could find 100 LTV Arizona Hard Money Lenders with relative ease. Obviously, not everyone offered loans worth the full value of a property, but home values were increasing at such rapid paces in most markets that a successfully-funded deal, even at 100% of what it was worth at the time of closing, could climb 5-10% or more in value before the project was even finished. That was one of the big draws to getting into the fix-and-flip market. It was incredibly difficult to lose money doing it.

That being said, the market crash changed a lot. Nowadays, fix-and-flips are still a lucrative field to get into, but you have to be smarter with your numbers because you can’t count on increasing market values to bring you profit; you’ve got to buy low, repair fast, and sell high. Moreover, getting 100% of the value at the time of the sale is unlikely, purely because the market isn’t climbing as fast. Most areas are still climbing, but at nowhere near the rates that they once were. Because of this, it’s more likely that you’ll get a deal funded at 60% of the value, with a few outliers climbing as high as 90%.

If that 90% isn’t going to get you where you need to go, you still have options. First, going with alternative lending means you can make an offer with cash-in-hand. Motivated sellers like that because it means they’re free of their problematic or junk house fast. They don’t have to worry about their buyer qualifying for, and possibly being denied, a traditional mortgage. That means you can often negotiate a better deal for the property, meaning your cost to purchase it would be lower and you’ll have more wiggle room for financing. As a second option, you can also consider cross-collateralization. Instead of relying solely on the value of the property you’re repairing, you could use another investment property or even your own home as collateral too.

An Experienced Broker Can Lend a Helping Hand

If you can’t find 100 LTV Arizona Hard Money Lenders and you’re still struggling for ways to fund your project, an experienced broker can help. Regardless of who funds your deal, they want you to be successful, and so if you’ve got a great property and have the knowhow, a broker can help locate a lender who understands your position or identify other ways to make sure that your deal goes through.

A successful project is a win-win for everyone.

Ultimately, you may not be able to find 100 LTV Arizona Hard Money Lenders or someone to fund a project, but that’s a lesson in and of itself. Savvy investors know when a project isn’t going to be a win, and they’re able to move away from it without emotion and onto something that is going to generate real returns. Find a good project, work with a seasoned broker who can find you the best terms possible, and build up from there.

Dennis Dahlberg

Broker/RI/CEO/MLO

Level 4 Funding LLC

Arizona Tel: (623) 582-4444

Texas Tel: (512) 516-1177

111 Congress Ave | Austin | Texas | 78701

Will Your Property Appraise?

You’ll want to consider these things when choosing an investment property because hard money lenders will require an appraisal to fund your loan.

Hard money lenders have to protect their investments and one of the ways they do that is by performing a property appraisal to determine the value of the home before renovation, compared to after.

There are some steps you can take when choosing your fix and flip property that will help the home appraise and get your proposal accepted by a Arizona hard money lender so you can get that money in your hands to begin the project!

Great Location

If your real estate investment opportunity is a fix and flip, it’s important to have a property that’s in a desirable location to ensure you attract buyers easily. Check what types of businesses are in the vicinity of the property and distance from busy streets. Those both will have an effect on the value of the home and can determine your loan amount from the hard money lender.

Floor plan

This is one of the most important things to consider about your property. If you’re looking for a fix and flip you want to see it from that buyer’s point of view. Could you envision someone or a family living in that home? If you’re looking at a commercial property, is it set up to have cubicles installed if the renter so chooses?

Neighborhood Trends

Every city has trends when it comes to desirable neighborhoods. You’ll want to be on the nose with where the population is moving and how quickly those homes are getting taken off the market. If you’re looking at commercial investment property you want to know where businesses are thriving and sticking around through the ups and downs of the economy.

If you have a real estate investment opportunity and want to work with a Arizona hard money lender to make your dream come true, contact Level 4 Funding today and we can hear your proposal, appraise the property, and fund the loan quickly to get you on the way to earning real estate money!

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC
Hard Money Lender
Hard Money Loans
Hard Money Loan
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis
Dennis Dahlberg Broker/RI/CEO

NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave | Austin | Texas | 78701
About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 43 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.
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Advantages to Fix and Flip Loans

Think fix and flip loans are the trendiest expensive hair do-up in the fashion world? Read on—this could help you out in ways far more permanent (pun intended) than a haircut.

Simply put, this type loan is dispensed when the buyer wants to purchase property with the intent of selling it once it is renovated—this is the flip. Most of such properties are in need of some repair and a good percentage of them need major work in order to command the best price. Once properly marketed and sold at a profit, the purchaser can then pay off their loan and still have cash in hand.

Defined as short-termers, fix and flip loansare taken by clientswho desire to buy, do the necessary repair work and sell their investment within a year following the purchase. Property appraisals are done both before buying and afterwards. It is advisable to deal with businesspeople you already know or private investors that can determine your ability to complete the project following your receiving the needed funding.

There are considerable advantages in using this type funding, a major one being that private lenders are not forced to run your credit history through a sieve as are conventional ones, such as a bank or mortgage company.

These groups are set up with rules that basically stop the entire loan application if one glitch or blot turns up. Time passes, the property could be sold to another buyer and your application may very well be turned down, which puts you back where you started.

Beginners to the field of investment generally have some if not a lot of difficulty getting needed funding. Escrow accounts or personal guarantees, perhaps both, may have to be completed and shown to a lender before money can change hands. Interest rates can on a yearly basis run as high as 20 percent.

Are there other advantages to fix and flip loans?

A real relief to investors is the time element involved in applying for this type of funding. Someone who has been in an established business and knows all the details involved can close a loan in less than two weeks, as opposed to banks that can take more than six months.

A second positive point is if the investor’s business is one with a good performance record, the less they will have to ‘pay’ for the loan—interest, fees and the like. Sometimes the borrower can have several projects in progress at once if they are allocated 100 percent of funding applied for.

Private lenders, however, are in the business of making money for themselves and looking to have you repair a property as soon as possible, get it on the market and pay off the loan quickly. One way they have of assuring this is to attach a lien for their security and as an instigator for the borrower, who will work harder in order to avoid losing whatever is attached to the loan.

Fix and flip loans are not the answer for every investor with an idea to make money—you need to know both advantages and disadvantages of this type funding. Know all the facts, take the time needed to learn all you can and then work on making your idea a reality.

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC
Hard Money Lender
Hard Money Loans
Hard Money Loan
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis
Dennis Dahlberg Broker/RI/CEO

How Long Can Hard Money Loans Help You?

Hard money loans are used for many purposes and come with a variety of financing terms. Depending on who you partner with, you could have months or years to repay the balance in full.

Before getting into how long you have to repay Arizona hard money loans (HMLs), it’s important to distinguish what makes them different from other lending options. People tend to gravitate toward this form of alternative funding when bank options just won’t cut it. For example, if a business needs to buy equipment, but the owner has rotten credit and the business hasn’t established credit yet, he might turn to an HML. People who work in real estate investing use them a lot too. They’re helpful because they close faster than traditional mortgages, so an investor can grab a good deal before someone else does. Banks recoil at the thought of financing homes that are in severe disrepair as well, so someone in fix-and-flips might use an HML while he fixes up the property. Someone purchasing a fix-and-hold, like a vacant apartment complex in disrepair, might use an HML during the repairs, then refinance under traditional terms with a bank after; once the bank is no longer put off by the condition of the property.

Most of the time, the money for these projects comes from private investors, or individual people who have done well enough for themselves that they’re able to finance the projects other people do. That means the requirements to qualify and the terms offered will be a little different depending on who is doing the financing. You’ll also find that brokers get into the mix because they help connect businesses and individuals with the lenders and help them find a lender who is going to get them the best terms possible.

When it comes to repayment terms, many lenders do not expect you to pay toward the principal while the loan is active. Instead, you’ll likely make interest-only payments, then pay off the balance in one lump sum at the end. This can either be at the end of your term or before, provided you have the means to do so. For example, if you finish repairing a fix-and-flip and get it sold in half the time you anticipated, you could pay off the balance then and there.

Terms Typically Run from a Few Months to a Few Years, Depending on Your Needs and Eligibility

Arizona Hard money loans are usually based on the value of an asset. In the case of equipment, it’s often the value of that equipment, but a business owner could also use property to secure the loan. When it comes to real estate, the property secures it. This means that becoming eligible for an HML is easier than qualifying for funding through conventional channels. However, your lender will also look at things like your ability to pay (cash inflows), your experience and plans for the cash, and the location of the property too. All this and more goes into deciding how long you’ll have to repay. That said, most people have somewhere between three months and five years to take care of the principal.

Alternative lending may be right for you if you know how to craft a successful exit plan.

Before applying for funding, create a solid timeline of when you’ll either be able to pay off the balance through the sale of your asset or by refinancing. When you know your own timeline and what it will take to get you there, provided you’re looking at 3-60 months, you’ll have a much easier time qualifying for hard money loans in Arizona that fit your needs.

Dennis Dahlberg

Broker/RI/CEO/MLO

Level 4 Funding LLC

Arizona Tel: (623) 582-4444

Texas Tel: (512) 516-1177