residental loans

How to Get Involved in
Residential Real Estate Investing

The residential real estate market is ripe with well-priced investment properties for the ambitious investor. These days, almost anyone can get involved by buying a fix and flip property, a vacation rental or even a small multi-family unit. Gone are the days of wealthy investment companies monopolizing what can be a very lucrative and low-risk investment avenue for the right person. 

If you are looking to get involved in the residential real estate market, it can be easy to think that you should simply apply for a standard residential mortgage. However, for investors looking to fix and flip, build on or rent out housing, a residential mortgage comes with a ton of unnecessary baggage and long wait times that can cramp your style and get in the way of you closing a deal. 

Whether you are looking to buy a single family home or duplex with the purpose of renting it out, or you want to buy a fixer upper and sell it at a profit, time is of the essence and money talks. That’s why residential investors should consider a short-term hard money loan over a standard mortgage. Here’s how they compare:

Residential Mortgage

• Requires a minimum credit score of 700

• Terms usually last 20-30 years

• Involves an exhaustive amount of personal paperwork including W-2s, pay stubs, income verification, 2-3 years of tax returns, and so on…

• Time-consuming appraisals, inspections, and even more paperwork for the property

• Can take over 2 months to receive financing

• High percentage of rejections (even at the last minute)

• Limits on how many mortgages can be taken out on investment properties

Hard Money Loans for Real Estate Investors

• Credit score is not usually a factor

• Short term loans with terms between 6 and 24 months

• Involve very little personal paperwork, no tax returns, W-2s or income verification required

• Valuation of the property, no other paperwork involved

• Financing can be received in a few days

• High approval rating

• No limit on loans for investment housing

One of the most common phrases uttered by the unsuccessful homebuyer is “The mortgage fell through.” When it comes to investing, you simply don’t have the time to gamble on a fickle bank or mortgage provider. Residential hard money lenders want to get you your money as quickly as possible. A quick loan means another property for your portfolio and another happy customer for them. 

Now, you might be thinking, isn’t it just as time consuming to find a residential hard money lender as it is to work with a bank? That’s where we come in. Total Capital Network has curated a diverse network of residential lenders who are ready to work with you today. We match residential investors with lenders based on location, property type, loan type, estimated credit score and loan amount. This way, you save time searching for the best lender for your situation and they save time searching for an investor who is ready to close a deal. 

So what types of residential lenders can you find through our network?

We offer lenders in all 50 states including fix and flip lenders, residential rental lenders, residential construction loan lenders, refi lenders and bridge loan lenders. Our lenders offer a wide array of financing terms and options depending on the amount you wish to borrow, the property and other factors. No matter the type of residential financing you need, we can match you with the appropriate lender.

At Total Capital Network, we know real estate investing can be stressful at times. That’s why we screen and vet each of our lenders to make sure they are ready and willing to provide our investors with offers and terms that are simple and straightforward. You can rest easy knowing that we don’t just let any private lender into our network. We’ve done all the homework so you can focus on finding new investment opportunities and building your portfolio.

Who can qualify for a residential hard money loan? 

The best part of applying for a hard money loan is that anyone can qualify, even those with bad credit, bankruptcy, or foreclosure. No tax returns, no income verification, no previous properties? No problem.

Those who qualify for a residential hard money loan include:

• Individuals who are looking to buy, renovate, resell, refinance or build on a new or existing residential property.

• Corporations or LLCs looking to diversify their investment portfolio to include residential property. 

• Trusts and estates that want to grow their money through residential investment properties.

You read that correctly, our lenders will work with corporations and estates as well as individuals or small businesses. The key factor is that the property is non-owner occupied so that the loan qualifies as a business purpose loan. This makes it easy for anyone who wants to act fast on a residential property and start making money right away. 

In order to offer you a loan, our residential property and residential construction loan lenders look at the property in question. The value of the property is all they need to decide how much financing they can provide you with. Because this is the only information they require, you can expect to get a quote right away and, if you’re happy with that, get financing in only a few days (as compared to weeks and weeks of waiting for a mortgage or bank loan). 

When should you apply for a residential hard money loan?

When it comes to real estate, time is of the essence, so knowing how to time your loan application factors into the bigger picture. Here’s what you should know:

Before applying for a loan, you should have a property in mind. 

•  You should know the cost and the approximate value of the property.

•  You should have an idea of how much you are able to put as a down payment. 

• You should also have a budget of other costs such as renovations, repairs, new construction, permits and so on. This can factor into your loan amount. 

• You should have a general timeline of how long it might take from the time of purchase until you start making money from your property; this includes a timeline of new build construction, if applicable.

With these things in mind, you simply fill out our quick (37 seconds!) and easy form with a bit of the above information and we’ll do the rest. Expect to get matched with 1-2 lenders who are ready to work with you. Based on the information you filled out, they will already know your situation and have an idea of your financial needs, credit score and the property in question. 

From there, they are able to offer you a quote and begin the application process. Only then will they check your credit and process your application. With that done, you can expect your money right away. This means you can get the property you want before your competition even finishes reading through their lender’s fine print!