Holistic Survival
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Hard Money Loans Thrive in Obama’s Stagnant Economy

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A funny thing happened on the way to the upcoming November American presidential election: the economy didn’t recover like it was supposed to. Unemployment remains high, house prices depressed, and it’s still not easy for many folks to qualify for a mortgage through traditional channels. That’s where the idea of hard money lending comes in, and despite it’s faintly loan-sharkish name, this is a legitimate (we’d say even smart) way to earn a nice return on your investment. The first thing to keep in mind is that this advice comes from Jason Hartman, founder of Holistic Survival and one of the most respected names in the real estate industry.

Through both personal experience and recommendations made through his Platinum Properties Investor Network, Jason has helped investors locate thousands of income properties and, coincidentally, it was because of the network he stumbled upon a market in need of private hard money funding for short-term loans. First, let’s define what a private hard money loan is.

Traditionally, property loans – call them mortgages if you prefer – are made through “corporate” type entities like banks or mortgage companies. Most are of the long-term variety and are not consummated without a fairly strenuous credit evaluation by the lender. No one blames them for that. They’re on the hook for a chunk of money. They want to make sure they don’t continue to contribute to Obama’s foreclosure fiasco. The bottom line is many investors are having a hard time qualifying for traditional property loans.

That’s when Jason realized he had a built-in source of solid borrowers he had already vetted to a large extent: the local market specialists who find and recommend worthy properties to the Platinum Properties Investor Network. As a part of their business, these market specialists buy foreclosed and other types of residential properties, rehab them, and offer them to investors like Jason and you. It’s a good deal for everyone.

The trouble that arises is our market specialists have been forced to jump through the red tape and bureaucratic hoops required by traditional lending sources to obtain money they really only need for a short time, usually only four months. So Jason and some of his clients began making their own money available to his market specialists as a short-term loan earning around 12.25%. If you’re thinking, “This ain’t too shabby, you’re right.” But you’re not going out on a limb here. Private hard money loans like this are offered based on the value of the underlying asset, in this case the property set to be rehabbed.

Various banking regulations make it difficult to secure financing on “transitional” properties. This is actually good news for potential private lenders like yourself because market demand creates a higher interest rate than normally associated with traditional long-term mortgages. There’s nothing sneaky going on here. By offering your money to loan our market specialists, you occupy the first position on the note and stand in line to take possession of the property on the extremely small chance that a borrower runs into financial trouble and defaults.

The thing to keep in mind here is that this pool of borrowers is not comprised of just any random assemblage of people off the street. These are real estate professionals, most of whom have a long history of success in the industry, and who have been chosen by Jason to do preliminary research on properties eventually released to the network as a good income property investment.

Mired in the midst of an economy that doesn’t seem to be improving yet, readers of the Holistic Survival blog and podcast listeners are always on the lookout for legitimate ways to safely increase their rate of return on investments. You might not realize it, but Jason doesn’t recommend an investment strategy unless he’s already done it himself and seen that it works. With Wall Street churn still in full effect, the stock market is, to be blunt, a pretty depressing place to throw your money. While we’d never recommend you risk money you can’t afford to lose making a private loan, the opportunity afforded to join Jason in lending hard money to property investors shouldn’t be overlooked. You can always call our office at 949-200-8009 if you have questions or simply want to discuss private lending with one of our property specialists. No high-pressure sales pitch here, just a chance to earn a nice profit within a short time frame.

No one here would suggest this should encompass the entirety of your portfolio, but right now, it could be a profitable addition.

The Holistic Survival Team

 

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