0ne of the most important financing options for house flippers is a bridge loan. This is a business loan that investors can use to buy a new property, flip it, then sell it. But while there are many types of business loans, what is so special about this one, that drives real estate investors towards it? Let’s find out below.
How Do Bridge Loans Work?
A bridge loan is a form of financing intended to provide a house flipper with immediate funding to flip a house as they await future income. An investor needs money to buy and renovate a house, and in most cases, they do not have that money. That is where a bridge loan comes in, to provide them with the working capital needed for remodeling that house and selling it at a profit.
A bridge loan is what allows an investor to complete a purchase instead of watching a property being acquired by someone else. Plus, in most cases, paying in cash works to the advantage of house flippers as they are likely to get a better deal. Borrowers usually have about a year to sell the renovated house and pay back the loan.
House Flippers Usually Need Funding Quickly
One of the reasons that bridge loans are attractive is that getting them is much quicker. The house-flipping businesses tend to move really quickly. If you have seen a house that you want to flip, so have other investors. And if you delay in acquiring it, another investor will. However, banks tend to take a long time before approving loans. The quickest way to get funding is through bridge financing. In most cases, such a loan gets approved in 24 hours.
House Flipping Needs One to Move Quickly
A house-flipping business requires investors to get in and get out quickly. That is because the real estate market changes frequently. You want to ensure you can make a profit at the end of the day, and so you cannot afford to hold on to a property for long. Otherwise, the market can turn, and you find that you are not making the profit you expected to.
If you are looking for a bridge loan, let Artis Commercial Capital help. We offer alternative financing solutions to house flippers, allowing them to acquire properties easily. Call us today for your funding needs.
Financing is an important part of farm operations. It can help you purchase necessary items, expand your business, and cover unexpected costs. There are a variety of financing options available, and the best one for your farm will depend on your individual circumstances.
To this end, there is a variety of pieces of farm equipment that can be financed. Some common items include tractors, combines, and trucks. Financing can help you purchase these items new or used, and can also help you cover the costs of repairs and maintenance.
Starting Your Own Farm Operation – Financing Options
It’s important to carefully consider your financing options before making a purchase. Some factors to consider include the cost of the equipment, the terms of the loan, and your ability to repay the loan. Working with a financial advisor can help you make the best decision for your farm.
In addition to equipment, you may also need financing for other aspects of your farm business. This can include buildings, land, and livestock. Financing can help you cover the upfront costs of these purchases and can also provide ongoing support for your operation.
When choosing a financing option, it’s important to consider the interest rate, repayment terms, and any fees or penalties associated with the loan. You’ll also want to make sure that the lender you’re working with is reputable and has experience working with farmers.
There are a variety of government programs available to assist farmers with financing. These programs can offer low-interest loans, grants, and tax incentives. Some of these programs are specific to certain types of farms, so be sure to research the options that are available to you.
Your local bank or credit union is another potential source of financing. These institutions may offer special programs and rates for farmers. It’s important to shop around and compare offers before deciding on a lender.
The Preparation Stage
When you’re ready to apply for financing, be sure to gather all of the necessary documentation. This can include financial statements, tax returns, and other information about your farm business. The more prepared you are, the easier the process will be.
Once you’ve found a lender you’re comfortable working with, it’s time to negotiate the terms of your loan. This can include the interest rate, repayment schedule, and any other conditions of the loan. Be sure to get everything in writing so that there’s no confusion later on. For more tips just like this, as well as in-depth help with all things business and finance, contact us at Artis Commercial Capital.
If you currently own a home and are interested in building or purchasing a new one, you might want to consider getting a bridge loan before your current one sells so you can get started on your new construction.
In this article, we’ll answer some questions about bridge loans and new construction financing.
Types of Bridge Loans
There are two types of bridge loans: closed and open. They are different in several ways. A closed bridge loan is a term loan referring to financing with a fixed, predetermined, and planned repayment path.
Can I Use a Bridge Loan to Finance New Construction?
Both builder loans and bridge loans allow an investor to purchase land/property- but cannot be used to finance construction expenses. A new construction loan can be used to build a new structure, but a bridge loan allows investors to purchase land/property later on.
How Do Bridge Loans Work for Construction?
The funds from a bridge loan can be used to cover the mortgage as well as down payments, closing costs, and fees. The loans are usually short-term, with terms of no more than 6 months.
Criteria for a Bridge Loan
The first thing the lender will want to know is how much you need to borrow through your bridge loan. You must be willing to provide the collateral for the loan and to sell the property that you have so the lender can secure the loan.
Even if you’ve had difficulty qualifying for credit in the past, you may still be able to get a bridge loan. Your personal financial life and your chances of being approved differ from one lender to another. You will need to provide your property or another asset to prove that you are creditworthy.
What can Bridge Finance be Used For?
Bridge loans are typically used to fund commercial or residential real estate transactions, developments, auctions, and renovations.
Disadvantages of Bridge Loans
- Bridge loans may take 18+ months to get approved or denied
- Future payments may be risky
- Credit cards/installment loans have higher interest than traditional credit
If you are interested in learning more about bridge loans and how they can help you, contact Artis Commercial Capital today. We can help you find the financing you need to finance your new construction.
If you have been thinking of starting your own floral business, there are a few things to know. These tips can make or break the success of your business in an uncertain time- plus help your business thrive and grow.
Here’s 8 steps to starting your own floral shop:
Find your Niche
First, find your niche for the business- including where your location will be. Research the area you are considering to be sure that a new shop will thrive here- or, set up an online storefront.
Keep it Legal
Check with your area’s municipal offices for any permits or certifications needed before you open for business. Make sure to comply with local laws and regulations.
Market your Brand
Start some excitement regarding your opening with social media marketing tactics. Advertise what you are going to do- floral delivery is hot right now- and let people know how to find your flowers.
Figure a Budget
It is important to figure out how much it will cost your shop to thrive each month to find your annual operating costs. Most new businesses are recommended to have enough cash on hand to cover their expenses for at least a year.
Streamline your Equipment
What will you need for equipment? This could be a major expense so consider what you will need very carefully by looking at what you plan to sell.
Hire some Help
Next, figure on the payroll for any staff or employees that you hire. Remember that there are costs associated with hiring help beyond their rate of pay, including insurance and social security.
Don’t Forget Supplies
Floral arrangements and other related products rely on packaging to get where they need to in one piece. Make sure that you prepare for this with the right supplies and packaging materials on-hand before you open your door- even if it is a virtual store.
Invest in POS
You will need a Point of Sale (POS) system to handle your sales. These systems also make it easier to figure out payroll, inventory, and bills for your business and are critical if you plan to accept credit and debit cards.
Thinking of starting your own floral shop or business? Find out what you need and learn more by consulting with the money experts at Artis Commercial Capital; call or visit today!