CA Mortgage Pro offers a variety of residential and commerical private financing options to our clients in Lafayette and the San Francisco Bay area. Private Money or “Hard Money” is asset-based financing that comes from private individuals or companies as opposed to more traditional institutions and conventional lending sources.
Traditional lenders, such as banks, will evaluate the credit worthiness of a borrower while private lenders look will at the strength and value of the real estate that is being purchased. This private financing is much more flexible than closely regulated traditional financing. This flexibility allows for much faster closing in time-sensitive situations allows borrowers access to financing for purchases that might not receive consideration from more traditional sources.
Hard money and private money are often used interchangeably, however, private money lenders are generally considered more relationship-based than hard money lenders. CA Mortgage Pro has been working closely with clients on private money transactions for over 22 years, many of which are repeat customers. Private money often finances investment strategies, making relationships between the lender and borrower essential to success.
Two very common real estate investment strategies that generally utilize private money for financing are fix and flip, and buy and hold strategies.
Fixing and flipping properties is a very common type of real estate investment. These investors require short-term financing to purchase a distressed property and make necessary renovations and repairs. Once the property has been fixed, the investor will resell that property for profit. Fix and flip investors will often have multiple projects going at the same time, meaning they will need ongoing access to capital. Conventional financing is typically not available to fix and flip investors making private money a popular option.
Buying and holding properties is very similar to fixing and flipping. The difference is that rather than reselling the property once updates and repairs are made, buy and hold investors will hold onto the properties to generate long-term rental income. While the nature of the investments are similar, buy and hold investors require financing over a longer period of time because the property is not being immediately sold for profit.
Bridge loans are also very popular in the private money market. These loans, as the name suggests, serve as a “bridge” between periods of financing. A bridge loan is a short-term loan that can be closed very quickly, allowing the borrower to capitalize on an investment opportunity until more long-term financing can be acquired.
For over 22 years, CA Mortgage Pro has been offering private money to borrowers and investors in need of financing for residential and commercial real estate projects and investments. No matter what your strategy might be, we are able to offer fast closings, providing immediate access to the funding you need. For more information on private financing, contact CA Mortgage Pro today.