Real estate rehab investors report that funding is increasingly difficult to acquire. A new report shows that at least some of the blame has nothing to do with the economy, but in how borrowers approach the process.
The 12 Deadly Mistakes to Avoid When Applying for a Private Real Estate Loan is a report released by private lending company Stout Street Funding. It is based on the hands-on experience gathered from loan requests submitted over the past two years by borrowers in forty-two different states.
“A common problem that many real estate investors working with rehab properties discover is that they used the wrong method for estimating the value of the property,” said Cash Doye, president of Stout Street Funding. “Since loans are based on property value, many borrowers hope to use the ‘after repair value’ of the home. There’s often a rude awakening when they learn that loans are based on the current ‘as-is value.’ That’s often tens of thousands of dollars less.”
Another common problem is investors not taking into account that a neighborhood is declining in value. This makes their selling strategy ineffective since sales prices are falling in the entire area. The longer they hold the property, the less its worth.
“Investors can still make money while home values are dropping,” said Doye. “But, they need to use a strategy that is built on speed. Most investors miss that and it makes it much more difficult to get a loan.”
The report, The 12 Deadly Mistakes to Avoid When Applying for a Private Real Estate Loan, covers a range of errors and their corrections. It can be downloaded at http://www.stoutstreetfunding.com
Stout Street Funding is fully licensed and lends in virtually every major metropolitan area in the country. The company processes, underwrites, funds, services, and manages each loan it originates. As a private lender, Stout Street provides a viable alternative for real estate investors.
Stout Street Funding is a founding member of the American Association of Private Lenders (http://www.aaplonline.com) and fully conforms to its code of ethics.
To download this report from Stout Street Funding, go to http://www.stoutstreetfunding.com
Cash Doye, President, Stout Street Funding
(720) 235-4920 – firstname.lastname@example.org
Web Site: http://www.stoutstreetfunding.com
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Filed under: Real Estate
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