Mortgage & Commercial Lending News.

It is not the same to evaluate financing unimproved versus improved properties, short term vs long term loans or the level of risk 

the borrower represents.

To put it simply, financing real estate projects varies significantly from one borrower to another, AND from one type of property to another.  

To make sure we are on the same page: in Hard Money Lender's terminology, an unimproved property means the property does not have a structure on it: for example,

• a vacant lot or vacant acreage is an unimproved property. An improved property means the property has a structure on it (regardless of its condition).
• In the residential arena, an improved property can be a single-family dwelling, a duplex, or an apartment complex.
• If it's a commercial property, an example would be an office building, a shopping center, a warehouse, or a data center.
  

Mr. Marvy Finger, an 86-year-old Houston based real estate investor, was featured this month in Forbes magazine[1] in a fascinating article about the future of rental properties.
Turns out that Marvy Finger recently sold 2 billion dollars worth of rental properties to real estate investor Greystar. Yes, you read it right: 2 billion dollars (worth exactly two thousand million dollars, and that's just half of what Marvy Finger owned before the trade). The article's central theme is that Marvy Finger thinks rents must come down, in short to midterm, from what he thinks are unsustainable levels. In contrast, Gresytar believes that rents will keep increasing, and it's a good time to invest in rental properties.

Most of us like surprises, when and if they are pleasant surprises. However, the past few weeks surprised the world in a very unpleasant way. The appalling reappearance of war in Eastern Europe. When we look back to the end of last year, we wish world leaders and diplomats had been more determined or forceful to find a solution that would have helped prevent this absurd war. We would have expected things to be different in Eastern Europe and continued to enjoy peace, however fragile. Our deepest desire today is to end the war in Ukraine and return to peace. After witnessing the ravages of war all over our media channels, our hearts go out to all those currently suffering in Ukraine.

We recently wrote in one of our blogs about pooling incomes in a household to obtain a mortgage. We mentioned that multigenerational households could be a trend in the housing sector. Changes in demographic behavior could lead to even more households becoming multigenerational. In this blog, we would like to assist you in thinking around some issues when you are looking into purchasing and renovating a home suitable for a multigenerational household.

In one of our weekly updates, we recently wrote to our clients that home prices might be growing faster than rents in most places across the country. But, financially speaking, homeownership still beats renting, as shown by a new study from ATTOM Data Solutions, a real estate data firm. In about 6 out of 10 localities across the U.S., it is cheaper to own a home than rent, so it is still a good idea to own rather than rent, even more so in creeping inflation environments like we have been experiencing. Still, it is usually easier to sign a lease contract than to get a mortgage.

Due to a lack of industry knowledge, the general public often believes myths about asset-based mortgage lenders or Hard Money Lenders. Many people have misconceptions about their loans to real investors and home buyers. In this article, we intend to tackle these myths and misconceptions.

It is never too late to get into real estate investing. Yet, as with many things in life, you must study and be diligent to be a successful real estate investor because, mind you, real estate investing is not as easy as some make it sound on TV: there are plenty of aspects that could go wrong when buying a property as an investment. In what follows, we give you some tips that might prove helpful to you whether you are a proven investor or are just considering getting into real estate investing.

Let us suppose that you are interested in getting a mortgage loan from us, so you call us to ask about our mortgage rates and loan terms. To make sure that we give you the correct answer, we need to know whether your potential application will be ranked "good," "fair," or "poor." One of the elements in your evaluation is pulling your credit report.

Many of our customers worry that pulling their credit reports will hurt their credit scores. So here we explain what happens to your credit score and suggest to you some tips you might want to follow when shopping for a mortgage loan. You might also want to read what the Consumer Financial Protection Bureau (CFPB), a US government agency, has to say about this subject on their website: https://www.consumerfinance.gov/ask-cfpb/what-exactly-happens-when-a-mortgage-lender-checks-my-credit-en-2005/ .

A lot has been said and written about “making your money work for you,” a colloquial, charming way to refer to passive income (that is, income that does not come from those employment or activities to which you dedicate most of your time in order to generate said income). Still, we think our faithful readers can benefit from being reminded that there are ways of generating passive income in the real estate industry, taking advantage of hard money loans.

Fears of rising inflation in the US have been garnering attention all over the news and in many other countries. The Economist (a magazine published in the UK) included in its November 13, 2021, edition an article entitled “A three-decade high in inflation sows concerns about America’s recovery”. The Australian (a newspaper printed in Australia) included an article with the headline “US inflation spike to record levels means mortgage rates in Australia are almost certain to rise.” Forbes published during September 2021 an article about inflation and mortgages^[1] and how it might be a good time to buy a house to protect yourself against rising inflation. And we could continue citing interesting inflation-related articles.

Better than just letting you navigate in the news, let us try to give you our point of view on what you as a borrower of real-estate related loans, be it a mortgage for your new home or a bridge loan for a fix and flip, should know about inflation and loans.