I love mentoring new real estate investors who are serious about turning it into a full-time career—they’re always enthusiastic and willing to learn. One topic that comes up a lot in my mentorship sessions is hard money financing. Since these loans are usually offered by private companies rather than the big banks we’re all familiar with, novice investors often don’t know which lenders to trust. The best way to find a reputable hard money lender is through recommendations from other experienced investors, like me.
The Top 6 Best Lenders for Real Estate Investors
I compiled a list of the best lenders for real estate investors based on my own experience and the experience of other veteran investors in my network. These hard money lenders all have a national or multi-state presence, as well as reasonable loan terms and trustworthy reputations.
Residential Capital Partners
Residential Capital Partners (also known as ResCap) funds single-family rehab and rental investments across the U.S. in several key markets. ResCap is made up of experienced real estate investors and house flippers, which means they know how hard it can be to turn a property around and understand that things don’t always go according to plan. As such, though they typically offer nine-month loan terms, ResCap allows for extensions if needed and doesn’t charge a penalty for early repayment. ResCap also offers 100% financing for purchase and repair costs, up to 70% of the home’s after-repair value (ARV) to a maximum of $1.5 million. If you follow the “70% rule” in house flipping, this means you could purchase an investment property with almost no out-of-pocket costs.
Finance of America
Finance of America provides real estate investment loans nationwide, with a few exceptions. They welcome both novice and experienced investors to apply, but they offer an additional benefit to real estate veterans. For qualified investors, Finance of America provides fix and flip lines of credit for up to ten million dollars, so you can purchase and flip multiple properties simultaneously. This allows you to maximize your potential ROI by taking advantage of hot markets and great deals, even if you’re already working on another property. Finance of America also has a minimum interest rate of 6.75%, one of the best in the industry.
RCN Capital offers a variety of loan programs to real estate investors in 44 states. They provide 100% financing for single-family investments with or without rehab costs. They also provide financing for multi-family investments for up to 80% of purchase + 100% of renovation costs. RCN provides a clear and simple breakdown of its four real estate loan programs, so even first-time investors should have no problem choosing the right loan. They also offer advice for real estate investors, making RCN an excellent lending resource for newbies. If you’re interested in a long-term rental loan, RCN also offers 30-year terms for single- and multi-family rental properties.
Flatiron Realty Capital
Flatiron Realty Capital was founded in 2018 as a privately funded real estate portfolio lender that offers alternative sources of financing to real estate developers and investors throughout the United States. Specializing in bridge loans, construction/rehabilitation financing, and 30-year rental investment products, Flatiron provides holistic solutions to satisfy its core customer base’s short-term and long-term financing needs.
As a self-funded, fully integrated real estate lending platform with access to institutional partners within the securitization markets, Flatiron harnesses the hands-on, service-oriented approach of a local lender with the capital markets execution capabilities and technology-enabled infrastructure of a highly-scalable organization to offer customers proprietary credit solutions and customized service offerings.
Kiavi (formerly LendingHome)
Kiavi (formerly LendingHome) empowers real estate investors with the intelligence to act, the timely capital to fund opportunities, and the confidence to scale their businesses expertly. Our built-from-scratch technology simplifies every stage of the loan process, ensuring quick and easy financing. We offer a variety of bridge and rental loans with low costs, high leverage, and a tailored experience with a team of experts. Kiavi has originated more than $7.8 billion worth of loans over 35,000 projects nationwide.
Before choosing a lender for your real estate investment, you should do some independent research on the exact loan terms and conditions for the products you’re considering. While most of the information you need is available online, it can be challenging to dig up and confusing for first-time investors who aren’t familiar with short-term financing and real estate legalese. And, when you’ve found a once-in-a-lifetime deal, and you’re rushing to secure financing, you may not have the time to compare all your options thoroughly. Luckily, there’s an easier way.
An Easier Way to Find the Best Lenders for Real Estate Investors
Finding hard money loans for my real estate investment properties became much easier when I joined the HomeVestors® network of independent franchises. That’s because I have access to the UGVille® proprietary software platform, which features a lending portal that matches me with reputable hard money lenders.
All I have to do is enter in some details about my property, and then I can see which lenders offer the best loan products for my needs. I can also easily compare terms and rates between different lenders, ensuring I always get the best deal. Plus, since the nationally-trusted HomeVestors® name backs me, hard money lenders actually compete for my business, so I can sit back and wait for the best offer. That’s why I tell everyone I mentor to consider becoming a HomeVestors® independent franchise.
To learn more about how HomeVestors® can connect you with the best lenders for real estate investments, contact us today!
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