Many of my clients are real estate investors, short term flippers who use our California hard money loans for rehab financing. Over the past 12 months, competition among real estate investors has heated up with regards to REO properties. One avenue a number of investors seem to be turning to is targeting short sales as a larger portion of their business.
Short sale properties for real estate investors are not as attractive as the bank owned properties are. Typically the time from offer to closing is longer, sometimes much longer, than it is on a straight bank owned property. With more competition and lower inventory, however, short sale properties are becoming more attractive as they can bring a larger profit margin than many REO sales that may have multiple offers that bid the price up.
Not only can short sales potentially offer larger profit margins, but with the changes going on, the time frame on short sale approvals and closings are starting to get shorter. This is likely to continue, which is good news.
Using this strategy, although the turn time to closing may still be longer than straight bank owned sales, many investors are finding they are able to secure a price that affords them the profit potential to make the transaction profitable. Recently I came across an interesting article that took a look at the various banks and their average discount to market value that their short sales sold for. This is potentially some great information for investors; for more information you can read my post about the top banks for rehab investors to target.
As a hard money loan specialist, many of the transactions I help with these days are acquisition/rehab loans. We are able to get pretty aggressive money put together on these deals, lending on the after repair value and including funds for the rehab and interest payments. Visit our rehab loans page for more detailed information on the rehab lending we can help with or call me directly today at 877 462 3422. I only can help on properties located in California, but am able to help throughout the entire state.
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