Private Lending Chicago

The Chicago residential mortgage market continues to limit the availability of mortgage money and real estate investors are turning to private lending and private money lenders to facilitate their needs. Private Lending Groups has had a strong resurgence of investors and borrowers requesting hard money loans and private rehab loans.

Private lending is sometimes defined as a loan that mortgage banks won’t do. However in this market even financially strong investors find the private lending quick approval and closing an advantage over banks and mortgage lenders.

Private Lending loans range from borrowers with low FICO scores all the way up to complex commercial deals involving blanket or bridge financing. The private lenders offering these funds are typically private individuals funds put together to fill the void for investment and commercial fundings.

With the recent credit tightening of institutional financing and the folding up of over 321 sub prime and prime lending institutions, these types of hard money pools are gaining popularity with real estate investors and mortgage brokers.

Private lending investments

These new private lending loans by wealthy investors or funds pay them an above average return on investment of approximately 10-12%. They then loan the money out and keep the origination fees that they collect from the borrower.

Past private lending and hard money loans carried a negative stigma. This comes from the high fees (points) and high interest rates that some lenders charge. Interest rates of twelve percent are a normal starting point for these private lending loans. Origination fees are also typically ranging from 3-10 points (3-10 percent of the total loan amount borrowed.)

Surprisingly enough for real estate investors, this type of loan is a wonderful thing. Residential investment mortgage loans have nearly dried up while the number of pennies-on-the-dollar foreclosure homes has gone through the roof. In many cases, real estate investors are happy to get financing so they can take advantage of record low real estate prices and purchase real estate investments. With the advent of the private lending and hard money lenders comes relaxed guidelines and a more common sense approach to lending.

Private lending loans are typically at a maximum of 65% of the purchase price of a home or its appraised value and repairs. For a private lender, this gives a tremendous cushion and a firm reassurance that a borrower will pay their monthly hard money mortgage payment. If borrower does not pay, the private lender will foreclose and own the home at a roughly 35% discount.

There are few other qualifications to a hard money loan besides having “skin in the game” (having the 20-35% to put down on a purchase in a real estate investment) A few private lenders require the borrower to have a FICO score of 620+ but other hard money lenders in the business still loan to any good project with a 65% LTV or lower.

If you are looking for a private lending loan on an investment property, a commercial refinance or a commercial transaction your first stop should be to visit our we site at www.PrivateLendingGroups.com. They provide private lending money loans strictly based on LTV (Loan-to-Value Ratio.).

Private Lending Groups assists in the placement of funds for these loans as well as consults investors with diverse yield requirements from all over the United States.

If you are interested in investing in private lending loans or hard money mortgages get our FREE Report “The Best Way to Earn 8-10% Interest Secured by Real Estate!” FREE Report Click Here

Commercial Hard Money Loans

Commercial Hard Money Loans Illinois allow real estate investors to borrow against the value of their commercial property or non owner occupied residential property. Commercial hard money loans also known as bridge loans or mezzanine financing are a clever tool, but borrowers must be sure to understand all the potential risks involved. Consider the following suggestions to ensure that you are making the most of Commercial Hard Money Loan you secure for business purposes:

Commercial Hard Money Bridge Loans

When you are securing commercial hard money bridge loans, time is usually a major consideration. Knowing these terms may not seem like an integral part of using commercial hard money bridge loans but these terms can make stipulations about how the funding can be used and what your responsibilities are in paying back the loan. To find the best commercial hard money bridge loans for you, shop around for commercial hard money bridge loan specialists like Private Lending Groups.

Commercial hard money loans can be closed quickly. Usually less then 2 weeks for the closing process, but keep in mind the risks involved with essentially carrying commercial hard money loans and mortgages. Before you commit to a commercial hard money bridge loans, it is important that you understand the mortgage bridge loans basics. In mortgage bridge loans, a property owner may be charged as much as 12% interest and two to five points for the use of the money.

Commercial Hard Money Loans

Commercial Hard Money Loans in Chicago allow real estate investors to borrow against the value of their commercial property or non owner occupied residential property. Commercial hard money loans also known as bridge loans or mezzanine financing are a clever tool, but borrowers must be sure to understand all the potential risks involved. Consider the following suggestions to ensure that you are making the most of Commercial Hard Money Loan you secure for business purposes:

Commercial Hard Money Bridge Loans

When you are securing commercial hard money bridge loans, time is usually a major consideration. Knowing these terms may not seem like an integral part of using commercial hard money bridge loans but these terms can make stipulations about how the funding can be used and what your responsibilities are in paying back the loan. To find the best commercial hard money bridge loans for you, shop around for commercial hard money bridge loan specialists like Private Lending Groups.

Commercial hard money loans can be closed quickly. Usually less then 2 weeks for the closing process, but keep in mind the risks involved with essentially carrying commercial hard money loans and mortgages. Before you commit to a commercial hard money bridge loans, it is important that you understand the mortgage bridge loans basics. In mortgage bridge loans, a property owner may be charged as much as 12% interest and two to five points for the use of the money.

First Time Home Buyers

Should First Time Home Buyers Buy A Home? Are you having  thoughts in buying a new home? Well, now is the right time to buy a new home. Check out the following reasons why first time home buyers like you must not think twice in purchasing a home of your own.

1. Low Interest Rates. Today’s interest rates are reduced to 5% and below. The government helps the first time home buyers by purchasing mortgage securities to maintain the low interest rates.

2. Cheap Home Prices and Best Deals for First Time Home Buyers. As of today, home prices are reduced by over 30% in most markets since 2008. Look out for foreclosed and bank owned properties since they offer incredible deals. Most sellers are willing to pay 3-5% of the buyer’s closing cost just to close the deal. For this reason, you can also enjoy lower interest rates.

4. Low Down payment for First Time Home Buyers This 2011, expect to see changes on the requirements of first time home buyer loans. The minimum down payment may be increased from 3.5% to 5% while the seller’s maximum contribution may be reduced from 6% to 3%.

For more information click here.

Refinancing in Chicago

If you are considering refinancing your home loan, you may be faced with the decision to take an ARM ( adjustable rate mortgage), or a fixed rate. Your own personal situation, as well as what you expect from your refinanced mortgage will have a great bearing on whether you should choose a fixed rate mortgage, or look for another alternative.

What Is A Fixed Rate Mortgage?

A fixed rate mortgage is exactly what it sounds like – a home loan that has a set interest rate over the term of the loan. If you take a home loan refinancing over 30 years, your interest rates will stay the same over the next 30 years, or until you refinance. Other fixed rate mortgages may only be for a set amount of years, such as 1-10 years and then they are set to adjustable rates.

How It Is Different From An ARM?

An adjustable rate mortgage has an interest rate that is subject to change depending on current markets and financial trends. Unlike a fixed rate mortgage, ARM loan monthly repayments are subject to change, if interest rates increase, so do monthly repayments.

Who Will Benefit From A Fixed Rate Mortgage?

A fixed rate mortgage offers borrowers stability. If you have a great credit rating, you will always be offered a reasonable interest rate. Many people with a long-term steady job who want to budget over the long run choose a fixed interest rate loan over taking the risk of an ARM loan, which is subject to change depending on current markets.

Pros And Cons Of A Fixed Rate Mortgage

The fixed rate mortgage is one of the safest types of loans available, and you know right from the start what you are paying since this figure never changes over the term of the loan. Some of the problems you may encounter with a fixed interest rate mortgage are the difference in interest rates. A fixed rate mortgage will always be higher than an adjustable rate. If you have a bad credit history, you are likely to pay an even higher interest rate than other people with good credit. Because of this, many people choose to take an ARM loan over a fixed rate.

Other things to be mindful of when refinancing to a fixed interest rate, is the likelihood of interest rates dropping dramatically, and you are left with a very high interest rate compared to what others are paying. Apart from this, a fixed interest rate refinance has very few risks involved, and will provide borrowers stability over the long term with their refinancing needs.