Be Realistic

Today, more than ever, the only way to get any project funded is to be realistic on what your orbjectives are and what the project is all about. In addition, a borrower should expect to pay if he wants to have flexible borrowing options. When the fed lower interest rates, it does not affect hard money lending. Today, there is less money available to finance project. The most attractive project will be financed the other will not.

A big NO NO!! Regularly, we are still getting calls from either brokers or individual who tell you the following "I am buying a property for $1,000.00 but its real value is $2,000.00". Well if the real value was $2,000.00 it would be transacting for $2,000.00 not $1,000.00. This is for Single Family Residence up to 4 Units. In REO areas this even more true. The value today of an SFR is what it will effectively transac for within 90 days. It does not matter if the property is owned by a bank or if it is the current owner who will sell it.

Here is what I am saying, REO prices are current market value and this will not change for a while. Look at it another way, if you want to buy gas and two stations ooffer it one offer the gas .50cents lower than the other one. The only thing to do to get the lower gas is to go accross the street, what will you do? Personally, i am going to go accross the street. Same for houses, because there are so many properties owned by bank, only in certain areas such as San Francisco, Downtown Boston, Manhatan etc... you will pay a price that is not as discounted. However in places such as, Miami, California's Central Valley, Phoenix AZ etc... you will buy property at great discount prices.