A temp to perm loan, also known as a bridge loan, is a type of loan that allows real estate investors to purchase and renovate a property using a temporary loan, and then refinance the loan to a permanent, conventional loan once the property is leased. This type of loan can be beneficial for real estate investors because it allows them to avoid the traditional 20% down payment required by conventional lenders, and to purchase properties off-market as rental investments. Additionally, temp to perm loans can be an option for investors with bad credit or financials that may not
meet the requirements for a conventional loan. Tidal Loans, a Houston-based hard money lender, specializes in temp to perm loans and can assist investors in qualifying for conventional loans and refinancing their temporary loans. This type of loan is useful for investors who want to keep more of their cash in their pocket and purchase property in a competitive market, and also for those who are looking for 100% hard money loan financing.
Temp to perm loans are a type of loan that allows real estate investors to purchase and rehabilitate a property with temporary financing (hard money loan) and then refinance that loan with permanent financing (conventional loan) once the property is leased out and generating rental income. This type of loan is beneficial for several reasons:
- Avoiding the traditional 20% down payment conventional lenders require, which allows you to keep more of your cash in your pocket.
- Purchasing an off-market property as a rental in a competitive market. A cash offer can help secure the deal.
- Bad Credit Loan. Credit or financials may not be high enough to get in a conventional loan.
- Looking for 100% hard money loan financing. Tidal Loans offer no money down financing if the property is bought well.
The process of refinance a temporary hard money loan to a permanent loan is a crucial step for real estate investors, as the higher rate on the temporary loan will hurt the property’s cash flow and conventional loans tend to have lower mortgage rates. Tidal Loans assist their clients by determining their end strategy for the property, qualifying them to ensure they can get a conventional loan before they buy the property and walking through the process of refinancing the hard money loan to conventional loan.Regenerate response
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