Monday, April 24, 2017

5 Things You Did Not Know About Hard Money Loans

There are many concepts about hard money loans with some of them being true while other being entirely false. It is always better to do all the research yourself and get sufficient knowledge pertaining to them. The majority of the new investors have no idea about the hard money loans and they overlook certain specifications and benefits which are involved in them.

Here is a list of some of the important things about hard money loans in Houston Texas or anywhere in the united states which most of the people are unaware of:

Hard Money Is a Legitimate Business

Hard money lenders are business people who lend money to other people for their own business purposes. This means that they are no different than a bank because, in essence, they actually do what the banks do, they lend money. It is a mere misconception that these people are involved in some sort of illegal activities and are not reliable whereas, in reality, they are only running a business.

Hard Money Means The Loan Is Backed By a Hard Asset

The word hard only implies to an asset and nothing else. When you borrow money from a hard money lender, he secures his investment by asking for a collateral which is actually a hard asset. Most of the time, this hard asset is real estate. When you actually think about it, the banks also lend money in a similar way and the difference between the two lies in their policies.

There Is a Reason Why the Interest Rates Are High

Many people complain about the high rates of these loans but they have a strong reason for it. The people coming to them won’t get a loan from the bank because of not being able to provide a source of income to them or not having a great credit history. Such individuals then resort to the hard money lenders and if these lenders are putting their trust in them, they definitely need something in return.

Real Businesses Function Through These Loans

There are many reasons people do not go for banks and it is not necessary that their credit history is bad because they have been up to something fishy. Certain people are reluctant to tie themselves to the strict policies of the bank and need flexible working conditions. Thus, they resort to hard money loans. Additionally, the time period for these loans is also limited giving another reason to the borrowers to choose these loans over the bank loans.

Hard Money Lenders Won’t Do 100% Financing

Most hard money lenders would want an assurance that you have the skills and expertise to carry out the business you are starting. This is the reason that they might not give you all the money required but if they can see that you have skin in the game, they might consider financing your business entirely.

Many people only have negative perceptions about hard money loans but they are a convenient option for a lot of investors.

Tuesday, March 21, 2017

Consider These Factors Before Finalizing Your Investment Decisions

Before we make investment decisions in any industry, it is always better to have a thorough and honest look at our financial condition. This is especially important if you have never seen or made a financial plan before. Although no investment decision is 100% certain and has its own pros and cons, there are some important factors we need to consider before we lock our investment in any particular field.

1.Draft a Personal Financial Road Map

The core most step is clearly recognizing your goals and risk affordability. You can evaluate this either by yourself or hire a finance pro to do the job. Then again no investment guarantees mounting profits, but if gone through careful planning and investment management techniques, there is a high probability of acquiring an acceptable level of financial stability with benefits from your investments.

2.What is Your Comfort Zone in Terms of Risk?

Any investment poses a certain degree of risk. For instance, investing in bonds, stocks, or mutual funds is a high-risk game as you can lose some or all of your money or principal amount invested.

But let’s not forget the fact the higher the risk, the higher the potential of greater returns. If you have a defined financial plan mapped for a long-term, you can make thick money by carefully opting assets with high-risks such as stocks, bonds, etc., rather than limiting yourself to low-risk investments like cash equivalents. Although low-risk investments are ideal if you want to stay with short-term goals. One big risk associated with low-risk investment is inflation, which can eat up your returns without leaving you much to enjoy.

3.Be Vigilant When Looking to Invest in Shares of Individual or Employer’s Stock

Diversifying an investment portfolio is a great way to lessen the risk on your capital. Its common sense: If you try to put all the food in one plate, it has a high chance of falling off! By choosing a number of carefully selected investment choices, you will not only be able to minimize the potential of risks but would also control the fluctuations on returns.

While investing in shares employed by your employer’s stock or an individual stock calls for huge risks on your money. If the stock performs badly or the company goes bankrupt for whatever reasons, then you’ll probably lose a thick chunk of your capital invested.

4.Have An Emergency Fund as a Backup

Intelligent investors tend to save a considerable amount of their capital, just in case immediately required like sudden unemployment. It is better to stock a capital that could last you around 6 months or more in situations when you are out of any means of earning.

5.Pay Off High Interest Credit Card Debt

An investment strategy is fruitless if it fails to pay off all your high interest debts you may have incurred. In case of owing high interest credit card debts, it is advised to pay off the whole amount as soon as possible and then starting to think about your investment moves.

Visit http://www.4smartmoney.com/ and find Real Estate Investment Properties in Houston TX

Thursday, February 9, 2017

Types of Loan Programs Offered By Your Bank

Getting a new setup? Starting a new business? Buying a new home? New beginnings can be exciting and risky at the same time. Getting frustrated and exhausted during the start of a new venture is bound to happen. And when you find yourself short of money it can be quite a challenge. Applying for a loan or borrowing money in situations like these is understandable. Though here are a few kinds of loans you should know about before walking into a bank and getting a loan.

1.    Working-Capital Loans:

If you are starting a small business or already have one and need some money to keep it up and running, working-capital loans are for you. It offers short term solutions, if god forbid your business isn’t working to its full potential, the loan you will get will fix the mess until the set up starts generating enough revenue on its own. However, be warned that they are often associated with ridiculously high interest rates and have limited time for repayment.

2.    Equipment Loans:

Every business needs some kind of equipment be it a computer, a copy machine, a cash register, etc. Equipment loans offer just that. Small business can get their own machinery by applying for this kind of loan. Monthly payments can be made if you negotiate the terms and conditions with your lenders.

3.    Lines of Credit:

Similar to working capital loans, lines of credit are short term as short as 90 days. The program provides loan to small businesses for regular issues and cash flow maintenance. They are not suggested for making large investments or purchases. This enables you to buy only what you need, and investments are made only on the items you use. Comparatively to others, they have longer repayment timeline. The only issue here is that they charge additional fee and if interests are not made in time you could find yourself in a lot of debt.

4.    Professional Practice Loans:

These loans are specifically for people in the practice sector, for example, medicinal like doctors and dentists, mental health professionals, lawyers, insurance officers, accountants, engineers, architects, real estate, etc. These loans are usually used for buying a space, renovating the office or buying appropriate furniture or equipment.

5.    Franchise Startup Loans:

If you are or you know an entrepreneur who needs financial help for launching their own start up, this is the appropriate choice to go for. Buying a franchise, building an office or restaurant or store, and buying equipment comes under the description.

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