5 Tips to Get Financing for Commercial Real Estate Investing

November 7, 2016 Finance Tips

Are you looking to get into commercial real estate investing? There are a lot of opportunities in commercial property investing if you work at it. If you are looking to find investment mortgage lenders to help finance your plans, here are some tips to help you get what you need.

You need a much bigger down payment. If you own your own home, you know that when you buy property, you have to put some of it down up front. If you want to secure financing from traditional investment mortgage lenders, you are going to have access to enough capital to make a much larger down payment than what you have to put up for a residential property. Most investment mortgage lenders require people come up with at least 20% to be able to get a traditional loan. If there is any way that you can come up with an amount closer to or more than 25%, you will put yourself in a position to get a much better deal on your loan.
Run your own credit report. Before you try to get a loan from investment mortgage lenders for your commercial real estate investing plans, you need to look at your finances and credit score with as objective an eye as you can. If you can improve your credit score and become more of a good credit risk you will appeal more to real estate investment lenders. The lower your credit score, the more expensive your loan terms will be. You will pay more in interest and more in fees.
Try credit unions and community banks before you try bigger financial institutions. If you find that you are not able to come up with the 20% that most mainstream investment mortgage lenders require for your loan, you may want to talk to the local credit unions and community banks for help. Their goal is often to help local people get loans for business plans that help the community. If you have an idea for a new business or to get into commercial real estate investing and can show how this will benefit the community, you have a better chance of getting some help from these financial institutions. They also have a lot more leeway and may be more able to say yes to you when you go to them looking for a loan.
Will the owner of the property help with your financing? When people are turned down by investment mortgage lenders, you may want to look into to options for owner financing. It used to be that one of the commercial real estate investing basics that people selling real estate were very wary of buyers who looked out for owner financing. This is becoming more and more acceptable. Before you head down this road, you need to develop a strategy. You need to have an amount you need a loan for and to work through the terms you would accept. You need to be able to make a great pitch and have all of your i’s dotted and t’s crossed before you approach anyone about owner financing.
Be creative. If you have found a really good property that you think you can really do something with and make some money on, you may need to get a little creative in how you come up with your down payment. People have looked to all sorts of alternative financing sources for their down payment arrangements. These have included credit cards, equity lines of credit, life insurance policies and more. At the end of the day, you need to research all of your other options and hunt down all other lines of inquiry, so to speak, before you opt for these very, very risky options. If you really think you are going to succeed, it may be worth it but you should do what you can to not have to get your financing that way.

Commercial real estate investing can be very lucrative. Commercial real estate is a lot different from residential real estate so you will need to do all of your homework before you take the plunge.

Starting A New Business? Start With Financing

November 4, 2016 Finance Tips

Are you the owner of a business who is searching for more information about financing? Maybe you run a child care business and are looking for new financial software to use, or perhaps you are the owner of an auto body shop and need financing to expand your space. Whatever your situation may be, the good news is that you have options. It is good to go into your financing search with a little information, and much of the information you find will be based on the type of business you run. Below are three specific examples of how various businesses find financing options:

1. Restaurant Industry Financing – Whether you have been in the restaurant business for years, or are just getting started it is likely that you have had to consider financing in some form. Whether your restaurant was financed purely by business loans from local banks, private investors, or other means, you had to ask for help somewhere and that is okay. Some of the most respected business men and women in this country today had to do the same thing. Starting a restaurant is difficult because not only do you have to set yourself apart from other places cooking similar cuisines, but you have to make sure you are using quality ingredients and using state of the art equipment. Those things, of course, cost money, and that is why restaurant financing is often times so complex.

2. Automotive Industry Financing – There are tons of ways to insert yourself into the automotive industry. Some people have small repair shops, others strictly sell parts, and others only deal in new or used vehicle sales. Even though each of those businesses is extremely different, they all have one thing in common: the need for initial financing. Small repair shops have to purchase machinery, parts shops have to stock their initial inventory, and new and used automotive dealers must have the vehicles on site for their customers to purchase starting on day 1.

3. Child Care Industry Financing – The child care industry is a growing one. In fact, many parents spend weeks sifting through the recommendations and reviews of local child care facilities before making their final decision. Of course, these parents are looking less at child care industry financing, and more at the credentials of who will be taking care of their children. Nevertheless, child care industry financing is extremely important to business owners to make sure that they can afford things like classroom materials, playground equipment, insurance, and even small items like decor that make the children feel excited to be there.

Whether you are a thriving chef ready to open your fifth or sixth restaurant, an auto salesman that is ready to break out on your own, or the owner of a successful child care business who wants to take your business one step further: financing can help, and it is available to you!

Making Wise Investments in Commercial Real Estate

November 3, 2016 Finance Tips

Are you a first-time home flipper looking for renovation financing? Or have you been investing in real estate and flipping houses for several years? If either of these situations apply, then you’re probably aware that in 2014 alone, 327,069 homes were repossessed. Many of these homes may be in poor condition, so the need for renovation lending is apparent.

While there are a number of reasons to invest in commercial real estate, expanding your business and investment portfolio may be at the top of your list. If you have already been making real estate investments for quite some time, and are looking for real estate investment lenders for a new or ongoing series of projects, you may be interested in knowing more about hard money rehab loans.

First of all, the interest rates are higher with hard money rehab loans. They do, however, have lower loan- to-value ratios. A hard money loan’s interest rate might range from 15%-to-18% or more.

Secondly, there are faster turnaround times with a hard money deal. These may only take one-to-two weeks in order to process.

Thirdly, the payment period is also shorter for a private loan. When comparing these loans with traditional bank loans, private loans extend for up to five years, while a traditional bank loan payment period is from one year up to 20 years.

If you were previously considering a standard bank loan, then you are probably aware that there are several stipulations for this type of loan:

You need to have been in business for two or more years.

You need to have a minimum of $250,000 in annual revenue or income.

You need to have good personal and business credit.

You need to have a consistent cash flow.

When you apply for secured short term loans, one of the operative terms is “secured.” If you are interested in obtaining a hard money loan, most of them need to be secured by an existing property you own. More specifically, the property you put up to secure your loan will need to have approximately 30%-to-50%.

When you are looking for hard money mortgage lenders, remember to consider the benefits of these types of loans over traditional bank loans.

Performing a Small Business Valuation Steps

October 27, 2016 Finance Tips

If you’re a small business owner, you may ask yourself the question What Is My Business Worth and for good reason. While competing a small business valuation can take up time that may be spent on other parts of a business, a business valuation can benefit any business owner in the following ways:

Full understanding of the parts of the business. Small business valuations can allow a small business owner to see all the parts of their business, from expenses to income, whether that is debt or payroll taxes or merchandise sold.
Full understanding of the circumstances surrounding the business. While the business itself may be the initial focal point of a small business valuation appraisal, the circumstances must be understood before the final value appears.

Those are the two components of a small business valuation appraisal. They are typically called the standard of value and the premise of value. Both are necessary to complete a full small business valuation appraisal, which is a process of measuring business worth. Business worth isn’t absolute. It can vary over time.

The two key starting points toward completing a small business valuation are determining why you need a small business valuation and assembling all the necessary information. There are three approaches:

By comparison to the recent sales of similar businesses.
Based on the business’s earning power and risk assessment.
Based on the business’s assets.

It is an economic exercise, one that requires the ability to analyze information pertaining to your business’s financial information. The key documents needed are the income statement for your business and the balance sheet. For a stronger small business valuation appraisal, those documents need to cover a three to five year period.

The income statement should contain all the ways in which your company is performing in terms of monetary value. Items on the income statement can vary according to the type of company but generally they include merchandise sold and services rendered. Looking at a three to five year period can give you a good understanding of how well the company has performed over a long period of time, which will give you an idea of projections.

The balance sheet should cover how your income is matching up with your expenses. Essentially, if your business is in the red or the black. Expenses can include employee wages, payroll taxes, bills, and debt, among many other expenses that can be a large amount of money or small.

The trickiest part of a small business valuation appraisal is the premise of value. This involves the circumstances surrounding your business and can entail many different influences. Influences on your business can include the local economy, the local market for your goods or services, and larger markets if your business has reached that far.

A company valuation is useful to understand where your small business has been and where it is going and give you information for the road ahead.

Three Reasons Why Having an Initial Public Offerings (IPO) Service is Beneficial

October 26, 2016 Finance Tips

Individuals who choose to invest may not have considered the many benefits that an Initial Public Offerings (IPO) service offers. Here are three reasons why having an IPO is helpful for anyone who wants to invest money with the chance of getting a better return than going the traditional way.

Getting an IPO Allows Those Who Are Buying to Potentially Save More Money

When buying an IPO, it is not uncommon for them to be cheaper than trading the traditional way. An IPO can cost anywhere from 13 to 15% less than buying traditional stocks, allows the buyer to save money in the process. Having an IPO can also help those who would like to buy a great deal of stock before it officially debuts on the market. There have been cases where the stock was sold right after becoming available on the market, and the return was triple what investors paid for it. Using an IPO service can help investors make the most of their money.

Having an IPO Can Be Viewed as Having Regular Stocks with More Return

For individuals who choose to get an IPO, the learning curve is not as difficult as one would expect. Even though an IPO varies from the traditional stock market, it can be viewed in the same way. If experts agree that a particular market is going to do well, then the IPO will also do well. If the IPO is up, the chances that it will out-perform the market is very good. Professional traders will find that an IPO service can be very helpful in getting a better return than expected.

IPO Services Have Been Around Longer Than Most People Realize

Although those new to trading may be unsure about what type of IPO company to go with, or if is it even worth it to use one, they can rest assured that IPOs have been around longer than many think. Since the late 1990?s, brokers and stock traders have been using the word when talking about IPO news.

Given that IPO service can allow individuals to save money, as well as offer a greater return, it makes sense that prime brokerage services encourage trading with it. It is not a new fad, and has actually been around for a while. With these factors in mind, it is helpful in reviewing IPO data, and knowing that it is a solid investment to make.

Commercial Real Estate Investment Groups In Your Area

October 18, 2016 Finance Tips

Commercial real estate investment groups could be the answer you need if you are looking into American capital partners who can help you. Often times these investment firms will offer you the best financing options for a piece of your businesses profit. While this might seem bad initially, if you employ the top real estate investment companies, you could wind up making three to four times as much as you were before.

Real Estate Investments Are Important

When it comes to your financial future, it is important to understand just how important things like real estate will be for you. As a millennial, you are already set in your ways a bit, but you need to make sure that you are taking investment seriously. As you grow older, you will begin to regret the time you wasted not investing in real estates, your 401k and other areas. This is why you should hire some of the best commercial real estate investment groups to help you out as needed. You deserve this much and it’s time you look into your financial future.

They Can Help Set You Up with Long-Term Revenue

If you need an investment firm, they might be able to help you with investing in REITs. These are properties, usually involving commercial real estate, where you can invest your money into. As a commercial real estate property owner, this could be your solution to getting the funding you need, quickly.

You need to know that you are going to be able to cover costs as a business owner. Failure to do so will result in your business eventually closing down. This is not something you want to happen to you. This is why you should take your investment in REITs now, so that you can get it back later when you build your business even further.

Initially, you can have people investing into your commercial real estate and then you can then hire real estate investing companies to come help you out with setting up your own investment. With the investments you are getting for your building for being under the REIT and you getting REIT stocks, you’ll be able to have a lot more financial freedom than you ever thought before.

Look for Commercial Real Estate Investment Groups with Experience

When it comes down to it, you need to know that the company you are hiring is reputable and is going to be able to give you the best commercial real estate investment opportunities. Most companies who have been in the business for a few years have the connects to private-listings and other public-nondisclosed properties as well. Having this can help with your investment opportunities and getting you the money in the stocks you want.

Real Estate Trading Market Should be Taken Seriously

You should take real estate seriously because the market is just as valuable as the stock market. With people always in demand for homes and businesses, you can easily invest in properties and join their “stocks” to get the most returns.

This is going to be a long-term solution that will require only the best services and groups by your side. If you are new to the real estate market, you shouldn’t have to worry about whether a company can help you or not ? they should just be able to do it no problem. Commerical real estate investment groups need to be the best and you need to make sure you’re looking into them thoroughly before trusting them with your finances.

7 Tips to Help You Get Started in Commercial Real Estate Investing

October 16, 2016 Finance Tips

Are you looking to change up your investment strategy? Do you own your own home? Have you considered commercial property investing? Whether you have thought about it or not, there are a lot of reasons to invest in commercial real estate. If you are not sure how to get into this area, here are some tips to help get you started.

Commercial real estate investing success relies on planning. People who are not involved in commercial real estate investing look at people who do well and may think, “that person is very lucky.” While that may be true, the simple fact of the matter is that success in this area is really more about property preparation and planning and less about luck. This is one of the commercial real estate investing basics.
Look for areas that are being developed. When you are looking at commercial real estate investing opportunities, it makes a lot of sense to look at up and coming areas and less to established neighborhoods. For example, a decade ago, the Anacostia section of Washington, DC was probably the toughest part of town. Today, it is one of the trendiest parts of town. If you were looking to invest in an area of the nation’s capital and you invested in this part of town, you would be in great shape. Look to these areas that may develop. This is something you can research and you can find trends to give you an idea of what areas may be on the verge of renewal.
Keep an open mind about the kinds of properties you look at. It is easy to look only at retail space for instance but when you have your blinders on, you may miss great opportunities in apartment buildings or office parks. Commercial real estate investing is not limited to one kind of building or business. You may have a preference for what kind of buildings you want when you start the process but do not let that limit your options or blind you to other opportunities.
Go big or go home. Well, not really but if you are looking at apartment buildings, do not limit yourself to smaller buildings, for instance. Whether you are renting to retail tenants, residential tenants or office space, if you have 20 units that are as easy to manage as if you had only 10. The main difference is the amount of money you will make every month. Again, be open to new ideas as you scour the commercial property investing sector for new opportunities.
Get advice from someone “in the know.” If you are new to the world of commercial real estate investing, you should by all means talk to someone who is not. Find someone you trust and see if you can pick their brain about the market and your ideas. Be prepared to get some news you do not like. Do not be offended by that. Just take it in stride and listen to the advice.
Consider taking on a partner or two. The really big deals are not made by one person, for the most part. If you are looking to get started in this, it is a good idea to take your thoughts to someone who is more experienced with commercial property investing and see if they will partner with you. There are a few good reasons to do this. On a human level, you will have someone to talk things over with and vent to. On a more practical level, you may find that you have more access to needed financing or real estate secured lending when you have a partner. Remember, two heads are usually better than one.
Patience is absolutely your friend. You may have bought residential real estate but the process of buying commercial real estate is very different. In the first place, it will take you a whole lot longer to get the commercial property investing deal finished and done than it does to buy a house. If you go into the process with that in mind, you will be much less frustrated and will be more sane when it is over and done.

Finding the Best Ways On How to Invest in a Reit

October 13, 2016 Finance Tips

American real estate partners buildings earn leed

If you’re wondering to yourself, “Should I invest in property right now,” the answer is yes! This is the time for you to go ahead with your plans and make a successful career for yourself as a real estate partner. You don’t even have to necessarily be a real estate agent to join the perks of the real estate world. We will explain a little bit in this guide what we mean. You will be looking into how to invest in a REIT and get the most benefits from your real estate partnership.

What Are REITs Exactly?

A REIT is also referred to as a Real Estate Investment Trust and is a company that owns or finances to different real estate properties that generate a lot of income. REITs allow you to invest in them, similarly to that of a mutual bond system. This will help you with generating more dividends, as a shareholder.

How to Invest in REITS

If you want to know how to invest in a REIT, then you are on a good path because this could be a huge financial cash out for you. Essentially, you are able to invest in portfolios of large-scale properties. This works similarly to that of the stock market, giving you the ability to have dividends instead of stocks. This is what most people are looking into doing now because it replaces the need to have to go out and purchase the physical property.

Are There Major Stock Exchanges?

Yes, there are major stock exchanges, similar to the stock market. However, there are multiple types of REITs that you will need to look into if you are looking into this investment opportunity. You will have an open market, public non-listed market, and private market. Each of these will depict where your REIT stands and if it?s a worthwhile building to invest in.

There are also two types of REITs right now that are the most popular and dominate the market. These include Mortgage REITs and Equity REITS, which generate income in slightly different ways. Equity REITS are for renters and they generate income via renting out to other people and the final sale of the property in the long-haul. Mortgage REITs work slightly different when investing and they are invested in mortgage loans. These can be tied to both residential and commercial residences.

New Sector for Equity REITS

As of August, 2016, when you begin learning how to invest in a REIT, you need to know that equity REITs are now considered to be part of a new sector in the real estate industry. They will no longer be considered part of the Financials Sector in the Global Industry Classification Standard (GICS), which is going to be great for getting better returns on your finances here.

You Should Always Look into Your Stock Options

Sometimes, it is just necessary for you to look into your stock options. This could be with the stock market or with the real estate market. Most Millennials, which are coming into the working industry, are beginning to learn about investment and the best practices. This is definitely one of the better practices if you are looking for a quick, easy start in the real estate industry. You just need to be thorough when you learn how to invest in a REIT and get the right financial planner to help you.

Even if you have a little knowledge, hiring someone for the first initial startup of the process can help land you better success and learn more actual tips when learning how to invest in a REIT. The more that you can learn from someone, the better off you will be when you go on your own and start investing in different REITs on the market.

Invest in Your Future

You are investing in your future when investing in a REIT. This is going to be something you can carry over and eventually cash out on when investing in your kids’ education. You could also use this as an investment for when you want to purchase a new house for yourself in the future. Whatever you plan to do with your investments, it will have a major impact on your future.

Understand All About IPO News

October 5, 2016 Finance Tips

If you are wondering about the stock market and recent IPO news, you have come to the right spot! We want to help you understand IPO information a little better and get you prepared for the stock market. Being in the know-how of an IPO company and the news surrounding it can help you make better decisions with the stock market.

What is IPO News Exactly?

Initial Public Offerings (IPOs) are essentially when a company “goes public” for the first time and opens its stocks up to the public. This could mean several different things, but for companies looking to do this, it means they are looking for more capital to continue to grow.

IPO Benefits for CEOs

If a CEO puts up their recently priced initial public offerings, it usually means that they are looking to grow their capital. When they are able to put their product on the stock market, it usually means that it has gotten too big to be able to sustain itself from the inside. So investors look at the CEO to outsource its funding source through the use of IPOs.

When a CEO goes public, they often control a large percentage of the stocks because they want to remain in control of the company. They are then able to convince others — like executives — to come join them without offering much salary, rather offering the IPO stocks which will be much more in value than getting a pay check once they are able to sell these stocks.

For most companies, this is the only option left to continue their growth process.

IPO Disadvantages for CEOs

For a CEO who just went released their IPO news, they are likely going to be under a lot more scrunity than if they were privately operated. They don’t have to release all of their information if they are private. However, once a person employes an IPO company and gets the process started, they have to release all information related with their business to the public.

This is the only way that people who are buying stocks from the company, can assure that they will get more money on their return than anything else. So for a company looking to keep their business strategies and techniques a secret, going public is not a good idea.

In addition, after getting IPO service and getting most of the stocks, CEOs can’t sell off their stocks and really cash in on those because it will look bad on the company. It can also make a CEO lose majority hold over his company and force the control into another persons’ hand. This is something every CEO fears and is why most won’t sell their stocks.

Advantages for Stockholders

When the initial IPO news is broken, you have the opportunity to buy them immediately. If you purchase the IPO stocks within the first day, you are guaranteed to usually get an investment return within a month. Most IPOs skyrocket in the first few months because the growth of the company becomes so transparent.

Although you have to wait 30 days after the release of IPO news to sell the stocks, which can cause prices to drop dramatically, this is still a good option, especially for people first looking to invest in the stock.

Read Up On Each Company First

It’s important to learn about a company first before deciding to purchase stocks from them during the break of their IPO news. Although going public is usually a good sign for a company, it doesn’t mean they will thrive and you could potentially lose all the money you made on your stocks.

Hiring a person to help you understand IPO news and how you can manage yourself through it is advisable. As a beginner, you don’t need to be troubled with how the market works. Your focus should be on understanding the essentials of trading and how you can be a success in the bond market. Get help with your financial future with an IPO company that cares.

How Can I Pay Off My Student Loan Debt?

September 28, 2016 Finance Tips

Are you interested in cash for your structured settlement? If you’re not sure what a lump sum payment is or how it works, you may want to continue reading below. More and more Americans are struggling with debt nowadays — from medical bills to student loans, the various factors that can sink you into thousands of lost dollars seem never-ending. With a structured settlement annuity you can see your debt gradually paid off over a fixed period of time with minimal interest and fuss, allowing you to get back to your life sooner than you thought possible. Let’s take a look at how this process works and whether or not it’d be right for you.

What Are The Most Common Forms Of Debt?

While debt can occur from many different situations, there are a few that are becoming increasingly common for the average American. Nearly one in five Americans under the age of 24 describe themselves as being in ‘debt hardship’, after all, so it stands to reason this is becoming a foundation everyone can relate to. Over 70% of Americans believe the greatest debt stigma concerns underpaid credit and debit cards. Medical bills, student loans and home payments are also common sources of debt hardship for many.

How Do People Generally Pay Off Their Debt?

Some choose to save up their money gradually, while others attempt to use whatever resources are at their disposal to shave away at stubborn debt. The average American household with debt carries over $15,000 in credit card debt and a whopping $129,000 in total debt — although household income has grown by 25% in the past 12 years, the cost of living has nearly doubled. Even now one of the most effective and popular methods of getting rid of excess bills and fees is getting cash for your structured settlement.

What Is A Cash For Settlement Payment?

Also known as a structured settlement annuity, selling a structured settlement is an incredibly effective way of tackling debt in a gradual manner. The average structured settlement payout in the United States is around $324,000, with over $6 million paid each year to fund new structured settlements. In fact, it’s been found that consumers vastly underestimate or overestimate how much debt they have — as of 2013 lender-reported credit card debt was a stunning 155% greater than overall borrower-reported balances.

What Is A Lump Sum?

Similar to a structured settlement annuity, a lump sum is a fixed payment you can receive to help pay off your bills. More than 37,000 Americans use structured settlement money on a yearly basis and over 90% of claimants who sell their structured settlement are ‘very satisfied’ with their decision. When the average American household pays a total of $6,000 in interest every year, it helps to have something you can rely on to reduce your day-to-day stress.

What Is An Annuity?

Compared to the one-time payment of a lump sum, an annuity is paid over a period of time. Selling off an annuity can surrender charges of around 10%, but the trade-off is a more feasible way of tackling your debt. Structured settlement payouts can reach over a $100,000, which is perfect for when medical bills and student loans are getting too high. If you want to get started on the right track to getting cash for settlements, look below for some simple tips.

How Can I Get Started?

Consumers have a wide variety of options for reducing pain and eliminating credit card debt, according to financial experts. Since a low credit score can impact your ability to apply for loans or buy a home, one of the first things you want to do is go to the source — a survey conducted by CreditCards.com found that people were able to successfully waive fees 80% of the time when meeting with credit card companies, allowing them to eventually balance out their score. Personal loan rates can be as low as 5% if you have a good credit score, giving you convenient monthly payments with accessible interest. Debt isn’t forever — with a structured settlement annuity, your goals can be realized in good time.

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Author: Finance Tips