Virginia is known as one of the oldest states in the United States, and has very close proximity to Washington D.C. During the 21st century, many professionals who work in D.C. have flocked to the Northern Virginia area in cities like Arlington and Alexandria, but Virginia is much more than Northern Virginia. There are great places to invest in real estate in Southern Virginia as well, from Hampton to Norfolk to Chesapeake, and most famously, Virginia Beach. There are also many great places to invest in real estate in the western part of the state, like Roanoke, Virginia, as well as the capital of Virginia itself, Richmond.
Virginia is known for having very diverse scenery, from beaches to mountains. While Northern Virginia can have a high cost of living well above the national average, the rest of the state is more affordable. Virginia is a great place to invest in real estate, according to Home Union, because it has a very strong tech industry. It is the best state for tech businesses and has a very well-educated workforce. It also has a very fair tax system that uses a progressive income system, and home and rent prices are currently above the national average.
There simply is tremendous demand for real estate in Virginia, as major employers from universities, the military, tech companies, and shipyards make it a very attractive place to live, buy a rental property, and go on vacation.
In most of Virginia, the real estate market is a seller’s market. It is a place where demand is exceeding supply and real estate investors are in a housing bubble where they buy homes for higher than listing price. Homes sell very quickly as investors get into bidding wars.
Hard money loans might be the best way to invest in real estate in Virginia. Hard money loans are also known as short-term bridge loans and last resort loans, but they are mainly used for real estate transactions where a home in disrepair is fixed and then flipped for a greater profit. Some real estate transactions often associated with hard money loans include fix and flips, long-term rentals, and construction projects.
Hard money loans have a huge advantage in seller’s markets of having very fast speeds of approval. While traditional mortgage loans can take a month or more to be approved, hard money loans can be approved in a couple of days. This is a major advantage in many robust seller’s markets, from Arlington to Virginia Beach, where you don’t want to miss out on a property just because you can’t get financed fast enough.
The reason these loans can be approved so quickly is because hard money lending is less regulated than traditional mortgage loans, and because they use the property as the asset. Hard money loans don’t depend on the financial standing of the applicant — while hard money loans have minimum credit scores of 600 to 620, hard money loans use the property as collateral.
If a borrower defaults on a mortgage, the bank forecloses on the property in a process that destroys a borrower’s credit score. But if a borrower defaults on a hard money loan, the lender takes on the property in a very fast and expeditious process. Every hard money lender prepares for that possibility before approving a hard money loan, so they themselves could turn a profit.
This means hard money loans also have a lot of disadvantages, including very high interest rates, low repayment periods, and lower LTV ratios compared to traditional financing.
At Hard Money Lenders IO, we have you covered. Here are the best hard money lenders in Virginia.