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A lot of real estate investors rely on hard money as a source of cash to finance their real estate investing deals. Until the current slump in the real estate market started, hard money was easy to get as long as the property met the lender’s requirements.

Most hard money lenders have recently tightened their lending requirements, but they are still quite easy to get compared with regular mortgages.

Should you make hard money your main source of funding your real estate investing deals?

What is hard money?
Hard money lenders use the property as collateral to lend money. Most hard money lenders just lend money based on the property, not the credit history of the borrower.

Even though recently a lot of hard money lenders are including some credit rating in their under-writing procedures, they still put less emphasis on credit of the borrower. However, most hard money lenders will require that the property has at least 40% equity or more to qualify.

Most hard money lenders will make the money available in a few days if necessary.

Hard money interest rates are therefore higher than traditional loans. You should expect to pay at least 18% interest plus points.

The payments are usually interest only, meaning that the amount you owe remains the same. The lifetime of a hard money loan is rarely more than 6 months.

If you are buying a property to fix and sell or rent out, it is unlikely that you will get a traditional loan to buy it. Hard money would be perfect for such a deal.

Your exit strategy after you fix it up must involve paying off the loan within a few months.

In a downward real estate market, it might be risky to expect to fix and sell the property within a few months.

You have to pay high interest for every month you keep the property under a hard money loan, eating into your profits.

A hard money loan would not be ideal for subject to deals where you take over payments.

Once you have determined that a hard money loan will work for you, the next step is to find a reliable hard money lender who finances projects like yours.

It would be a good idea to establish a good relationship with such a lender.

Usually you will need to show that your exit strategy is viable. A hard money lender’s worst nightmare is an inventory of property sitting in their balance sheets tying up their cash.

They will need to see an exit strategy that gets them their money back in a few months.

When presenting your deal, it is a good idea to give them your experience, your resources such as rehab crew, similar deals you have done in the past if applicable, and even prospective buyers if you have them. They will be more comfortable lending you their money for the deal.

Ultimately, your need to use hard money must be determined by the property and an exit strategy that can be realized in as little as 3 months.

No matter what type of deals you have, selling your properties fast is important to the success of your real estate investing business. Find out how an interactive real estate investor website that also builds your buyers list can help you sell your houses fast even in a depressed real estate market.

Tulita Smalbach lives and works in Cartagena de Indias Colombia. Working as a realtor in the Cartagena de Indias Real Estate market. Inmobiliaria Cartagena  is dedicated to providing its clients with honest and experienced advice when they are looking to purchase in the Cartagena de Indias market . If you are looking for lands (venta de lotes para proyectos inmobiliarios en Cartagena Colombia) or any other property (lotespara comprar en Cartagena de Indias Colombia) they can help you in your search through the next link:Inmobiliaria Cartagena de Indias Colombia

Have you considered using credit repair software to improve your credit history? Anything that brings about automation is definitely simpler than the same task done manually. But is automation always the best approach? Let’s take a closer look and focus on credit score improvement.

If you’re having credit problems there are two routes you can take –
(1) take the self-help approach, or
(2) get help from a credit repair business.

1. Fix it yourself – if this is your choice, you need some basic knowledge of the various aspects of credit repair. Even though it’s easy to find information on the Internet regarding how to repair your own credit, the task can be quite difficult. Of those who try it, many are overwhelmed by the task and come to the conclusion that the affordable fees that the average credit repair professional charges their customers is worth the cost.

Nevertheless for those who would rather do it themselves there is a useful tool – credit repair software. This software automates a great deal of the process, like simulating credit scores to improve your understanding of how they are calculated, creating dispute letters, automatic tracking, debt pay-off negotiations etc..

2. Hire a credit repair company – if you have decided you do not wish to spend the time and effort to fix your own credit score, you can hire a credit repair agency. These, at affordable costs, fixing your bad credit will take on the task of. These companies utilize credit repair software as a means of enhancing their efficiency and accuracy.

Is the software used in a different manner in one case or the other? When a non-professional uses the credit repair software, he or she will depend heavily on its automated processing minus a valid understanding of what the process is. Thus without adequate preparation and knowledge the software is not really as useful as it might be.

But if a professional credit repair company uses the credit repair software they know how it works and what customization is necessary to produce the best outcome for a given client. This is why the software in their hands is more effect than with the layman. The companies use it to improve their speed and accuracy of follow up – in other words, as a tool; while the layman uses it to compensate for his lack of knowledge.

So it’s easy to see that a more appropriate question is not “is using credit repair software a good choice”; but rather how to use this software to maximum advantage. Whether the software is used by an experienced company or by the layman, you cannot benefit from this software until and unless you have mastered the process of credit repair. If you use this type of software in conjunction with a firm knowledge of the process, the software gives you an awesome advantage; otherwise it has limited usefulness.

The credit repair sector is a business where customization is of highest importance – and so, without adequate wisdom and experience in applying the software, the outcome may be substandard.