Overall, there are a lot of great investment opportunities in New York City. It is the most populous city in America, as well as one of the biggest cities in the world. It is the most densely populated city in the United States and the capital of the New York metropolitan area. New York is the most photographed city in the world. It is known as a hotspot for immigrants, entrepreneurs, businessmen, and everyone.
New York is a city with terrific nightlife. It has great public schools and is one of the most diverse cities in the world. New York City consists of five boroughs: Manhattan, Brooklyn, Queens, the Bronx, and Staten Island. It has a population of just over 8.4 million people and gives residents a dense urban feel. It’s no surprise to anyone that Niche rates New York City a place with terrific nightlife through its bars, coffee shops, and restaurants. It is also home to many families and young professionals and has terrific public schools.
Right now, the median home value in New York is $606,000, and the media rent is $1443. The New York City real estate market is a buyer’s market where there are more homes for sale than buyers, and supply of housing is outpacing demand.
Real estate investors in New York City look into hard money loans. Hard money loans are loans that are primarily used for real estate transactions. In seller’s markets, they have the advantage of having very fast speeds of approval. But in buyer’s market, hard money loans have the advantage of helping buyers buy cash-only properties.
In buyer’s markets, cash-only means a home is in such terrible condition the home does not qualify for traditional financing. The bank won’t touch the property. Cash-only also means a buyer can only use cash to pay for the property.
A real estate investor can make a lot of money turning homes in disrepair into attractive rental properties, especially in a place where housing is so expensive like New York City.
Hard money loans are much less regulated than traditional mortgage loans. Loans can be approved much faster with hard money loans than traditional mortgage loans. This is because hard money loans use the property as the collateral and asset of the loan — these loans don’t rely on financial standing as much as traditional mortgage loans.
Because of this, hard money loans have a variety of disadvantages. They have higher interest rates than mortgages, which interest rates of 8–15%. This is much higher than interest rates of traditional mortgage loans. Hard money loans also have shorter repayment periods. They have repayment periods of more or less a year, which is significantly shorter than the average mortgage, which has a repayment period of 15 to 30 years. Lastly, hard money loans have LTV ratios of 65–75%, which is much lower than LTV ratios of traditional mortgage loans, which have average LTV ratios of 80%.
It’s essential to only trust the lenders who will give you the best rates and terms. Not every lender is trustworthy since some hard money lenders tack on extra fees and points, and other hard money don’t communicate well about fees like underwriting fees, closing costs, and origination fees. New investors have to be careful because not every lender gives to new investors given they have no track record of successful investments, and many who do have high interest rates.
At Hard Money Lenders IO, we have you covered. Here are the best hard money lenders in New York City.