Union City is a city in the northern part of New Jersey, with a population of just under 70,000 people. Union City is the most densely populated city in the United States, exceeding even New York City. Union City has two nicknames: the “Embroidery Capital of the United States” and “Little Havana on the Hudson.” The city was the result of a merger between Union Hill and West Hoboken Township.
According to Niche, Union City is a city with a dense urban feel where most people rent their homes. It is a New York City suburb where there are many restaurants and bars, which gives it a great night scene. There are also a lot of parks and green space in Union City, and Union City is a place with lots of families and great schools. It has a median home value of $340,800 and a median rent of $1225.
Right now, Union City is a buyer’s market. It is a city where supply is outpacing demand. Homes are staying on the market for a long time and selling for lower than the listing price.
Hard money loans might be one of the best ways to invest in real estate in Union City. Hard money loans are also known as short-term bridge loans and last resort loans, but they’re an alternative source of financing that are known for certain advantages. In seller’s markets, hard money loans have the advantage of having very fast speeds of approval. However, in a buyer’s market like Union City, hard money loans help qualify investors for cash-only properties.
Cash-only properties are homes that can only be bought with cash, but they also are in such a state of disrepair banks won’t touch the property. They require significant repairs to become attractive properties. Real estate investors can make a significant profit turning these properties into attractive rental properties.
Hard money loans are different from traditional financing because they use the property as the asset. They don’t depend on credit score like traditional financing, although hard money loans do have minimum credit score requirements of 600 to 620. Hard money loans using the asset as collateral also influences whether or not you’re approved for a hard money loan — if you default on a mortgage, the bank forecloses on the property, but if you default on a hard money loan, the lender takes on the property in a very quick procedure. Hard money lenders almost always prepare for this possibility when approving a borrower for a loan.
Because of this, hard money loans also have a lot of disadvantages. They have higher interest rates, lower LTV ratios, and shorter repayment periods than traditional mortgage loans. Hard money loans have interest rates between 8–15%, whereas mortgages have interest rates of just over 4%. Hard money loans also have repayment periods of more or less a year, which is much less than the repayment periods of traditional mortgage loans. Lastly, hard money loans have LTV ratios between 65–75%, which means borrowers often have to put down higher down payments to secure hard money loans than traditional mortgage financing, which often has 80% LTV ratios.
It’s essential to only trust the best hard money lenders who won’t tack on extra fees and points. That’s why we at Hard Money Lenders IO have made a list of the best hard money lenders in Union City — these are the best partners for your real estate transaction.