The use of leverage is the most powerful way in growing your wealth in real estate.
Leverage means using borrowed capital through loans to purchase properties that could generate cash flow to pay off the mortgage and generate profit for the investor. These profits can then be re-invested into growing your business, allowing it to snowball deal after deal, until you to build a vast and varied real estate portfolio that generates passive income.
But how do you get your start?
You'd want a lender who is supportive of your real estate endeavors, with accessible interest rates, flexible terms, a myriad of financing services and a user friendly process to help you transform your vision into reality.
Enter Lending One, a Boca Raton-based lending company.
Lending One is a private lender based in Boca Raton, Florida offering financing for real estate investors. Bill Green and Matthew Neisser founded Lending One in 2014 to provide a better alternative to traditional lenders with their rigid criteria for approval, and hard money loan providers with their expensive fees.
As a direct lender, Lending One helps investors get what they need in a real estate market scarred by the recent experience of the 2008 financial crisis, such as providing higher leverage coupled with lower fees. They have a team of advisors who can assist you in coming up with strategies to propel your business forward.
Lending One is a loan specialist with a myriad of financing products to help investors grow and improve their real estate portfolio.
Bridge loans provides real estate investors with immediate liquidity to fill the gap between current and future needs for your rental properties.
Bridge loans differ from traditional financing in several ways:
Lending One offers bridge loans with competitive rates starting from 5.99% for loan amounts starting from $1,000,000 up to a max loan of $15,000,000.
If you're a budding investor looking into flipping a property, you may have set aside enough capital for the purchase, but that is just half the battle. What you need is a short term loan to cover the upfront cost of repairs--something you'll pay back once the sale of the flipped property is completed.
Lending One prides itself as the best rehab lender in the market, helping private investors like you get your start in growing your real estate portfolio by funding up to 90% of an investment property's purchase price. Loan amounts start at $75,000, with terms of up to 24 months. Interest rates are decided depending on the borrower's credit score and the nature of the property deal.
Fix and flip loans have fast approval times so you can get the money within a week of your loan application. Even better, there is no prepayment penalty if you choose to make your payments earlier.
If you're looking for a lender to provide loans on a vast portfolio of properties you're looking to acquire, Lending One has several loan offerings with a variety of fixed rate terms to suit your needs.
For instance, their RentalOne portfolio loan has the longest terms possible (up to 30 years) and prepayment flexibility with loan amounts ranging from $500,000 to $2,000,000.
Their Portfolio Pro loan, on the other hand, can give you the best interest rates possible for a minimum of $1,000,000 and a max loan of $50,000,000.
With Lending One's portfolio rental loans, which are available to LLC and corporations, investors have the opportunity to consolidate several rental deals into a single loan. This streamlines the whole process of acquisition or refinancing single detached residences, 2-4 unit properties, condos, and townhomes.
Building a project from the ground up requires a massive capital infusion, a need that Lending One can readily fill. You can get $500,000 up to $5,000,000 to fund new construction projects with 12-24 month interest only loan terms. This means that the lump sum payment for the principal can be made at a later date.
Additionally, if you're looking into speculative developments, you can still avail of this loan without having to comply with the stringent review and appraisal requirements of other lenders such as banks.
Eligible real estate properties for this type of loan are single family homes, townhouses, condominiums, and multi family properties.
If you're a landlord who owns less than 10 rental properties and looking to take your business to new heights, you can avail of Lending One mortgage loans. You can avail of the loan to fund your acquisition of new rentals, or convert your built up equity into cash (cash out refinance).
With Lending One Mortgage loans, you can get up to 80% loan to value (LTV) for purchase and refinance, and up to 75% LTV for cash outs.
Compared to other lenders, it is easier to qualify for this loan as no tax returns are required, helping you get money faster. You can also close loans in behalf of your company, and if you don't have one yet, you can create an LLC before you apply.
In line with the founders' growing frustration over the tough lending landscape after 2008, Lending One aims to make it easier for an investor to get approved for mortgages. Lending approval criteria is mainly based on the real estate deal itself and not on the borrower's personal financial situation.
Each loan has different requirements but usually you'll be asked of the following:
Each loan application is evaluated on a case to case basis and other documents may be requested.
Yes, depending on the loan you want to avail. Generally, the borrower needs to have a minimum credit score of 680 to be able to qualify for loans from Lending One.
Yes. How much you need to pay in origination fees depends on the product you will avail.
Yes. For rental loans, an investor can opt for a recourse or non-recourse loan prior to closing.
A recourse loan holds the investor personally liable if they fail to make the payments and default on their loan, even if they have an LLC. This means, even if the collateral (i.e. property) has been seized, the lender can legally obtain additional assets (wages, personal possessions) from the borrower if the debt exceeds the collateral's value.
On the other hand, non-recourse loans have much higher interest rates as they are considered to be higher risk. Banks rarely offer non-recourse loans as this can leave them holding the bag if the customer defaults.
Kiavi is a hard money lender providing funding to real estate investors. They do not perform asset and income verification for faster closing times, so you can quickly fund your project.
Currently, they have the following mortgages available:
New Silver is another hard money lender offering fix and flip loans, rental loans, and new construction loans. In addition to products geared to real estate investors, they have personal loan products as well.
Generally, you only need a credit score of 650 to qualify for a loan from New Silver. Additionally, they boast of fast closing times, which can be as little as 5 business days.
Their loan products are as follows:
Fix and flip: covers up to 100% of rehab costs, with interest ranging from 9.5-12.75% for a loan amount up to $5,000,000
Rental: you can get up to $2,000,000 for a 30-year fixed rate of 7.5%
Construction: you can get up to $5,000,000 payable in 24 months with interest rates ranging from 9.5%-13.25%
Personal: you don't need to post collateral to get up to $100,000 with interest starting from 7% annual percentage rate (APR)
Nearly a decade in, Lending One company is carving out its own place in the real estate market due to its varied loan offerings and flexible payment options available to both the beginner and seasoned investor alike.
Although your credit score matters in the application, LendingOne is more focused on the potential of a property deal to determine if you qualify for a loan. This helps the customer obtain the necessary funding without having to jump through hoops as in the case with banks.
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