Albany is the capital of New York and home to the largest city in Albany County. Albany is known for being home to the Capital District of New York. It is consequently a capital for New York state politics. Since the late 18th century, however, Albany became much more than just a hub for politics. It has become known for banking and international trade, as well as a home for significant innovation.
Unlike other cities in New York, Albany is very affordable. According to Katrina Woznicki at USNews, Albany is the best metro area to live in in New York. Downtown Albany is known for its small businesses, churches, galleries, wine shops, and more. It is known for its culture and art galleries, and Albany is also known for having a very strong hockey scene.
Albany also has a variety of terrific colleges and is a college town as a result.
According to Niche, Albany has an urban suburban mix, and it’s a place where most residents rent their homes. Residents tend to be young professionals. Albany has a median home value of $179,100 and a median rent of $969, which makes it a very affordable place in a very expensive state.
Right now, Albany is a sellers market. In the city, supply is greater than demand, and there is a housing bubble where real estate investors are getting into bidding wars over the best real estate in the state.
Real estate investors in Albany should consider hard money loans. Hard money loans are also known as short-term bridge loans, and they’re predominantly used for real estate transactions like fix and flips, long-term rentals, and construction projects. Their biggest advantage in a seller’s market like Albany is they can be approved incredibly quickly. Hard money loans can be approved in a couple days, whereas traditional mortgage loans take a month or more to be approved.
The reason hard money loans can be approved so quickly is they use the property as the asset and collateral. Hard money loans especially use the after repair value of a loan as the basis for the terms and rates of the loan. The default process is different for hard money loans versus traditional mortgage loans. For mortgage loans, if a borrower defaults, the bank initiates a foreclosure that can be very costly and take a lot of time. For hard money loans, the lender owns the property.
This is why hard money loans have more unforgiving terms and rates than traditional mortgage loans. Hard money loans have interest rates between 8–15%, repayment periods of more or less a year, and LTV ratios of 65–75%. Mortgages tend to have much lower interest rates, averaging around 4%, as well as repayment periods of approximately 30 years. Also, mortgages have LTV ratios of approximately 80%.
Real estate investors have to be careful when choosing hard money lenders. Not every hard money lender has the best reputation. Some hard money lenders are known as loan sharks because they don’t communicate well about fees like underwriting fees, closing costs, and origination fees. Other hard money lenders don’t lend to new investors because they require a successful track record of real estate investments. This usually means new investors have to rely on factors other than experience to make themselves more appealing to lenders, like a strong credit score.
We have you covered at Hard Money Lenders IO — we have made a list of the best hard money lenders in Albany for your real estate transaction.