Tonawanda is a suburb of Buffalo, and is located in Erie county. It had a population just over 70,000 people, and is also known as “Kenmore.” It has a history of being host to many important railroad, and Tonawanda is also known for being home to a public park known as Gateway Harbor and being home to the Niagara River.
Niche says Tonawanda is one of the best places to live in New York. It gives residents a suburban feel, and most residents in Tonawanda own their homes. There are many bars and restaurants to give great night life, and it is also home to many young professionals and retirees. Tonawanda has great schools, and right now, it has a median home value of $138,000 and a median rent of $846.
Right now, Tonawanda is a buyer’s market. The supply of homes is greater than demand. Homes are selling for lower than listing price and staying on the market for a long time.
Hard money loans might be the best way to invest in real estate in Tonawanda. These loans are otherwise known as last resort loans, but their biggest advantage in seller’s markets is usually their very fast speed of approval. Hard money loans can be approved in a couple of days, whereas traditional mortgage loans can take a month or more to be approved.
However, in a buyer’s market, hard money loans have very different advantages. They are mainly used for real estate transactions to repair houses in poor condition, and buyer’s markets have a lot of properties that meet these requirements. In buyer’s markets, there are a lot of cash-only properties, which means buyers can only use cash to buy the properties. However, cash-only also means a home needs so many renovations and repairs banks won’t touch the property for traditional financing.
Hard money loans can often qualify as cash because they were essentially made to repair properties in poor condition. Plus, hard money loans aren’t traditional financing. In Tonawanda, hard money loans can make properties in disrepair more appealing to borrowers in a variety of ways.
These loans use the property as collateral and the asset, so house flippers don’t need to rely on a strong financial standing to secure a hard money loan. While hard money lenders still require minimum credit score of 600 to 620, the default process is different between hard money loans and traditional mortgage loans. If a borrower defaults on a hard money loan, the lender takes on the property swiftly and could make a great profit. But if a borrower defaults on a mortgage, the bank initiates costly foreclosure proceedings.
Hard money loans are inherently very risky as a result. They have higher interest rates, shorter repayment periods, and lower LTV ratios than traditional mortgage loans. Hard money loans have interest rates of 8–15%, repayment periods of more or less a year, and LTV ratios of 65–75%. These are all significantly less forgiving rates and terms than traditional mortgage loans.
It’s important to only trust the best hard money lenders, and many hard money lenders have reputations as loan sharks due to tacking on extraneous fees. Others don’t lend to new investors because they require a lot of experience of fix and flips. New investors often have to rely on successful financial standing and credit scores to make themselves appealing buyers.
At Hard Money Lenders IO, we have you covered. Here are the best hard money lenders in Tonawanda.