PRIVATE MONEY LENDERS - REAL ESTATE SOLUTIONS

 

PRIVATE MONEY LENDERS - REAL ESTATE SOLUTIONS

The coronavirus pandemic has thrown a monkey-wrench into all facets of life, including paying rent or the mortgage for some which includes real estate investors.

The real estate investment outlook prior to the coronavirus pandemic was looking pretty good with low interest rates, and new home construction still doing well. Fix-and-Flips were on the rise and rentals, though increasing, still were becoming occupied.

However, since the coronavirus pandemic, real estate businesses have either accelerated the growth of their real estate businesses or have watched their real estate businesses decline.

The coronavirus pandemic has impacted all businesses, with smaller companies being hit harder, especially companies with fewer than a couple dozen employees. Why?

Because a small business with fewer than a few dozen employees typically lacks cash flow and capital. Those companies were the first to reduce hours for employees or lay off employees. Those businesses were also the first to stop hiring subcontractors.

With the U.S. officially in a recession, millions of people are suffering.

And acting with compassion over the next 6-12 months is key, whether it is towards homeowners or landlords in trouble or renters having issues making payments.

However, for individuals who are properly positioned as real estate investors, the next few years will spell out O.P.P.O.R.T.U.N.I.T.Y

Even if the extra unemployment benefits and eviction moratoriums currently sun-setting get extended, they will expire eventually.

Between landlords having trouble collecting rents and homeowners in forbearance accumulating a pile of debt, there will be more distressed sales coming online.

Rentals will become cheaper…

And fix and flips will have less “newbies” competing for them.But…because of our housing shortage and continuing low interest rates, people will still buy your fix and flips (if you’re still in business).

The question is, are you going to be positioned to take advantage of these opportunities? Unfortunately, when the housing market softens or does anything resembling a crash, traditional financing dries up.

Hard money lenders go out of business left and right because they have lent to the wrong investors and banks get scared. So they pull out of lending on anything that’s not deemed “very safe”… They cancel credit lines, stop lending on construction or rehabs…And generally just crawl into a corner in a fetal position…(try to picture a “bank” in a fetal position…pretty funny).

That’s the hilarious thing about “Times of Opportunity”:

Most people get scared exactly when they should be entering the market in full force! So how do you ensure that you can still close on deals when all the dummies run for the hills?

Answer: Private Money Lenders

If you have solid private lending relationships, you will be able to pull the trigger on any deal you want. No matter what the market is doing or how many hard money lenders are filing bankruptcy.

1. Private money is personal.
2. Private money is flexible.
3. Private money is crash resistant.

If you BRRRR deals (Buy, Rehab, Rent, Refinance, Repeat), private money is crucial for short-term funding.

If you do fix/flips, private money is a FAR cheaper alternative to hard money and less risky. And if YOU are a good, honorable steward of that money, it will keep flowing to you.


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