Q: How can you tell if someone’s running the Milwaukee Marathon?
A: Don’t worry, they’ll tell you.
My running partners and I all know the truth of this joke well. Runners are single-minded in their topic of choice—it will come up. The flipside is that training requires a lot of time out on the road—and Oak Leaf Trail, and the occasional track workout—so you’d better have something to talk about to pass the time. Sometimes, I turn the topic to my favorite: buying, renovating, and selling houses for profit.
While I’ve been investing in Wisconsin real estate for many years, some of the younger guys who are interested in leaving their corporate job to start a business like mine usually get stuck on the issue of sorting out hard money options to get started with. That’s because comparing lenders requires looking at their terms, which is tough to do with precision without everything in front of you. I’ve had this question put in front of me enough that, here, I’ve listed a handful of hard money lenders in Wisconsin with the shortest closing times, along with some caveats for each.
Hard Money Lenders in Wisconsin: The Fastest Closers
I’m pretty familiar with the hard money options around town, but, as always, you’ll want to check with lenders directly, to ensure you’re working with current rates, fees, terms, conditions, and all that fun stuff. From being a professional real estate investor for as long as I have, though, I find that these ones tend to be the fastest closers, which is critical when you find a distressed property to buy and the homeowners are desperate to close.
Anchor Loans, LP
Whatever the amount you need to turn that investment property around, consider Anchor Loans. Their loans run from $50,000 to $20 million with terms from six to 60 months. Interest rates range from 9% to 13%, depending on the loan-to-value and your experience, and you may borrow up to 75% of a property’s value, or 80% of its cost. Anchor’s typical closing time is 14 days, but if you need hard money fast, Anchor should be on your list. Their fastest closing time? Two days.
Beyond those details, however, things get a little iffy. It seems Anchor prefers to work with more experienced investors, or those that have bought and sold at least five properties in the last 18 months. If you don’t have that kind of experience under your belt just yet, your good credit could provide you with some leverage but, most likely, you’ll need to apply as a qualified corporation or multi-member LLC. Of course, the actual rates and terms you get depend on your qualifications. But, you won’t even get to find out what those terms are until you’ve already plunked down your cash and are in contract on a property because they require that buyer’s contract as part of the application process. That’s a little dicey if you don’t have a backup financing plan.
JCAP Private Lending
JCAP Private Lending offers “fix and flip” loans in amounts up to $5 million. They’ll loan up to 75% of a property’s value, or 85% of its cost. Terms range from six months to 24 months. JCAP typically closes in eight days but their fastest time is three days. Or, that’s what I hear anyway.
JCAP’s website is slick but offers little concrete information about what you would be getting into by applying for a hard money loan from them. What you can tell by sifting through their website, however, is that you will be providing them with a lot of personal information that other hard money lenders wouldn’t necessarily ask for. In addition, to the typical documents, JCAP wants to see your bank statements, know whether you’ve defaulted on your federal student loans, and how much child support you pay. So, unlike many other hard money lenders, it seems that JCAP will spend a significant amount of time scrutinizing your creditworthiness instead of looking squarely at the deal you’re trying to fund. I’d probably skip all this hoop-jumping and work with a lender that knows a good deal when they see it.
Milwaukee Hard Money
Milwaukee Hard Money is the only company in this list that is actually based in Wisconsin. This lender’s average close time is “7-10 days (even sooner if necessary)”. Their loan amounts and terms vary, but they lend up to 65% of a property’s after-repair value at 15-18% interest, with six-month terms. This lender might be best if you need a lender with feet-on-the-ground market insight, but their terms are somewhat less attractive than others.
In fact, it’s Milwaukee Hard Money’s terms that I’d advise newer real estate investors to take a serious look at because they could put you in jeopardy if you are not careful. Did you catch that little detail above—six-month terms. If you don’t pay in full within six months, you will pay increased costs and interest rate. Or, they might refinance your loan, only to charge you another 5-10% origination fee. Under good circumstances even experienced real estate investors can take six to nine months to turn a fixer-upper around and sell it. Even with my background in flipping houses professionally, I wouldn’t go near terms like that.
Hard Money Lenders in Wisconsin: Apply as an Insider
When my running group passes an “ugly” house and rehabbing and reselling come up, I usually harp on the how my independently-owned and operated HomeVestors® franchisee network has saved me from some of the biggest risks to residential property investment. Whenever I have a question, like which hard money lender to use, I can ask other local HomeVestors franchisees for the real scoop on lenders nationwide. If you want to know local hard money lender reps, you can ask someone who’s actually dealt with them. When you have a strong network of franchisees like I do, you don’t have to just rely on what’s on the internet for information. You can potentially get a personal recommendation based on experience instead.
HomeVestors also gives you project financing access for qualifying purchases and repairs. If you’re a new investor, it’s a great way to open up new opportunities. Find out how by contacting HomeVestors today.
Each franchise office is independently owned and operated.