What is Real Estate Funding?
Regardless of when you start, real estate investment is one of the many ways to grow your financial portfolio. There is a common misconception that you have to have a lot of money to start with, which is simply not true. Investing in real estate without using any other money is in itself a sign of authenticity.
Generally, a private hard money lender offers an investor the opportunity to purchase a property for cash at a certain interest rate. Similar to a conventional bank loan, these private hard money transactions are structured to fix and flip or buy and hold real estate investments. Unlike traditional financing, however, real estate financing includes conditions and guarantees.
Pros
- Significant return on your investment
- Requires very little money of your own
Cons
- May require a down payment
- Will have to pay holding cost till property is sold
The Benefits of Real Estate Funding
As an investor, it is up to you to determine which property finance is best suited to your business. Hard lenders offer quick credit and finance, but they understand the specific needs of property investors. Real estate investors need to be aware of what they are getting into, and tough – lenders will have different requirements.