3 Different Types of Real Estate Loans

 


The real estate market is one of the most profitable ones, but it isn't for the faint hearted! The investment opportunities out here are vast, but you need to be able to make some quick decisions to close deals. Moreover, you need capital to invest in real estate properties. Well, that explains why real estate loans are extremely popular with various options available for investors.

If you're considering investing in a property but need financing, here's a list of some real estate loans you can opt for.

Fix and Flip Loans

A popular real estate loan type is fix and flip loans. Short-term loans designed for real estate investors are known as fix and flip loans. They only assist investors in purchasing and renovating properties to resell them for a profit after a span of 12 to 18 months. While some investors use standard loans and lines of credit to support their businesses, the vast majority of fix and flip loans are obtained by individuals or private investors. Fix and flip loans are widely used to buy homes at auction or in foreclosure, fund restorations, and upgrades, and cover other expenditures associated with property ownership.

Hard Money Loans

Hard money loans are complicated real estate loans but can be lucrative. In hard money loans, investors use their property as collateral for the loan. But the best part of this loan is the interest rate. Hard money loans usually end within a year with an interest rate of 12% to 18%. In addition, you can also obtain 2 to 5 points, with each point signifying 1% of the loan amount.

Bridge Loans

Another popular real estate loan option is bridge loans. A bridge loan is a short-term loan that helps you bridge the gap between when you wish to buy a home and when you can secure long-term financing. Bridge loans can be used to make a down payment and then look for another type of financing, such as a regular mortgage, to cover the remaining costs.

Additionally, bridge loans can be used to buy a new house before selling your previous one.

Whether you’re looking for fix and flips financing, hard money loans, or any other real estate loans, there's one private lender that can help you out—Insula Capital Group!

Insula Capital Group is a leading private lending and real estate investment company, offering various loans for real estate projects, including fix and flip projects, buy and hold, land development, new construction, and more.

Contact them right away to secure your loans!

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