Private Financing vs. Traditional Financing
One, of many, popular real estate concerns I encounter often revolves questions surrounding financing. Whether you're a retail buyer looking for your first home or a savvy investor seeking funds to leverage your next deal, financing plays a role in all non-cash closings.
Knowing how and where to look for financing, then, becomes as integral a part of your home search as the home itself. Knowing the pro's and con's of each financing platform can help you make the best financial decision.
I have aligned myself with multiple institutions and individuals that offer BOTH types of financing, so finding the option that best fits your needs has now become a passion of mine.
Traditional Financing (Mortgage)
Traditional financing is the most common form of financing, with regards to the purchase of real estate. This platform will, typically, provide you with a 30 year fixed rate mortgage somewhere in the range of 4-7%. This is a safe financing strategy and will require a credit score of 620 or higher; often 660 in some cases.
Example: 5% down, 6% interest rate, 30 year term, close in 30-45 days, credit requirement.
Private Financing (Equity Lending/Hard Money)
Private, or alternative, financing is another means of financing your first, or next, property. Although the terms tend to be a bit more dramatic to the first time buyer, they are quickly witnessed as supplemental to the investor seeking a fast approval and quick closing. Private financing will tend to be based more on the property and less on the buyer; whereas, with traditional financing, the buyer is much more integral to the loan's approval.
Example: 20% down, 14% interest rate, 4 year term, close in 7 days, no credit requirement.
For more information, visit WCEquity.com or Google Search "Kurt Westfield Real Estate" today.
Disclosure: no positions