Hard money lender and house flipper Beau Eckstein explains in this video what kind of terms a real estate investor could hope to get with a gap funding loan.
In short, Beau says, “It depends.” Gap funding terms rely on a few factors. Strength of the borrower, how much down, successful past projects, is the property in a hot real estate market, overall credit score, etc. – all of these factors–and more–determine what the gap loan terms are.
Basically, it’s risk-priced lending. Not only is an interest rate levied, but also the private money lender also takes equity in the property, so that once sold, the real estate gives the lender a good chunk of change.
For more gap funding information, check out http://reiloanpro.com/
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