Fix and flip loans are short-term loans used by real estate investors to buy and repair properties and then sell them for a profit. Private investors or investment funds, such as Altus Capital Group, offer such fix and flip loans. Investors often prefer to use private sources rather than banks and credit unions because of the speed and simplicity to close versus trying to obtain financing through a more traditional source. Additionally, unlike banks, companies such as Altus Capital are able to preapprove borrowers within certain criteria allowing buyers to confidently make offers with aggressive and attractive closing terms with confidence they will be able to close on the transaction. These loans include options like 401(k) loans and hard money loans, and established house flippers may use their line of credit to secure a loan.
Here are five reasons why a fix and flip loan may be the right choice for you:
- Flexible terms and conditions: Unlike bank loans, fix and flip loans offer flexible terms and conditions.
- Private lenders will often lend to investors even if they have been refused a loan by a traditional bank or credit union.
- Application process is typically less complex, much quicker, and requires far less documentation than bank loans.
- Lower prepayment penalties: Traditional loans often penalize borrowers who pay off debt before the loan matures. However, since fix and flip loans are short-term loans, the prepayment penalty is usually lower or non-existent.
- Faster approval: A fix and flip loan can be approved much faster than a traditional bank loan, which means you can go ahead with your property deal as planned. Thought it is uncommon, companies like Altus Capital have been able to close loans in as little as three days.
- A variety of properties are allowed: Banks often have strict guidelines for the properties they approve for loans, whereas fix and flip loans can be used for almost any type of property, regardless of its current condition.
Altus Capital Group is a reputable hard money lender in Northern California, known for tailoring loan offerings to fit the unique needs of its clients. If you’re interested in learning more about how a fix and flip loan can benefit you, call (707) 932-5887 to schedule a consultation.