Toledo is the fourth biggest city in Ohio, and right now, it is a terrific place to invest in real estate. It is often thought of as the second-best place to invest in real estate in Ohio behind Cleveland. Toledo is in northwest Ohio, close to the state’s border with Michigan. Historically, it has been known for manufacturing, transportation, the auto industry, and glass manufacturing.
This is why people call Toledo “The Glass City” today.
According to Jeff Rohde at Roofstock, Toledo is an incredibly affordable place to invest in real estate, at less than $90 for the average price per square. Investment dollars go much further in Toledo than in cities like Cincinnati and Ohio. Right now, Toledo is seeing a slow long-term population growth, and it has tremendous economic momentum. In particular, real estate investors can buy real estate for a strong renter’s market.
Right now, Toledo is a buyer’s market. The supply of homes is greater than demand, and real estate investors are in luck because they won’t get caught up in bidding wars. With supply currently outpacing demand, buyers have to invest to get a property in good shape, so the property stands out to the rest of the field.
Hard money loans could help with the rehabilitation of real estate properties in Toledo. Typically, hard money loans are designed specifically for repairs for distressed homes, fix and flips, and long-term rentals. Their biggest advantage in seller’s markets is their fast speed of approval. Hard money loans can be approved within a couple of days, whereas traditional mortgage loans can take at least a month to be approved. This is because hard money loans are based on the property as collateral, and particularly based on the after-repair value of the property.
However, in a buyer’s market, hard money loans also have the advantage of helping investors pay for cash-only properties. While a cash-only property might seem like a self-explanatory real estate term, this is actually a misconception: a property listed as cash-only is listed in that manner because it does not qualify for traditional financing.
Hard money loans can qualify as cash in a lot of these cases because they are specifically not mortgage loans. Instead, hard money loans are specifically used for rehab projects.
Hard money loans also come from plenty of disadvantages when you compare them to traditional financing. They have higher interest rates than traditional mortgage loans — hard money loans have average interest rates anywhere from 8–15%, while mortgage loans have rates just above 4% on average. Hard money loans also have shorter repayment periods, needing to be paid off within more or less a year, while mortgage loans need to be paid off 15 to 30-year rates. Lastly, hard money loans have average LTV ratios much lower than mortgage loans, which means they require larger down payments.
It can be difficult to find a good hard money lender since not every hard money lender is trustworthy. Some have extraneous fees like underwriting fees, closing costs, and origination fees, all of which are not communicated well by the lender. New investors can also have a hard time finding hard money loans since most require investing experience.
Hard Money Lenders IO has made a list of the best hard money lenders in Toledo. Look no further for a real estate investing financer.