Friday, 22 May 2015 00:00

Asset-Based Lending - The Next Step for Real Estate Investors

Asset-Based Lending and Real Estate Investments

investorAre you looking for working capital to support your real estate investment so that you can acquire more rental properties and make more profits? One of the best ways to acquire the financing you need is – asset based lending. This is a loan that is backed by assets such as properties you’ve purchased or accounts receivable from rentals.

Asset-based lending has recently become accessible all over U.S to owners of single-family rentals, condos, two- to four- unit properties and town homes; allowing interested investors to reach even the most expensive markets.

The Basics of Asset-Based Lending

This type of lending is based on assets used as a collateral for a loan. These assets are real estate assets, and not personal assets. To secure the loan, and eliminate any downsides, make sure that the financial information about your properties is both precise and accurate. Having a professional prepare financial statements and photos will help the lenders determine your property's value.

When Should You Consider Asset-Based Lending for Your Real Estate Project?

Asset-based loans should be considered as a source of capital when your real estate business is growing swiftly, or when you are in the middle of a turnaround. Asset-based money lenders give you cash you can immediately invest in your property.

Asset-Based Lending and Real Estate Investments

When it comes to real estate investments, timing plays a crucial role. These specific money lenders allow you to grab purchasing opportunities without involving your business capital, resulting in an improved financial control. This type of lending is reliable, as long as you have qualifying assets. The entire process is short and prompt, allowing you to close deals without wasting any more time.

Benefits of Asset-based Lending

No Credit Issues

Real estate investors often have a difficult time to come up with the capital necessary to purchase homes for rental purposes. Asset-based lending is not based on your credit history, but the quality of your assets. So, if you have had credit issues that held you back from borrowing, this may be your golden ticket to cash flow wonderland.

Expand Your Business

Of course, you need to purchase more real estate to expand your business. And if the traditional lending hasn’t been much help in that endeavor, an asset-based lending could work wonders for sprucing up your inventory.

The Bottom Line

Asset-based loans can be a blessing for real estate investors. Besides keeping prior credit issues aside, this form of lending also keeps cash flow problems at bay, since things are based on the value of your assets.

Real estate investors investing in rental properties to make a living or to supplement other sources of income can use asset-based lending as a powerful tool to help fulfill their investment goals. You can use asset-based loans to grow your business, as well, which will be highly beneficial if you’ve had faced problems borrowing from traditional lenders.

Rental Home Financing offers asset-based lending that provides an excellent opportunity to unlock equity in existing rental properties or to access financing to purchase new properties. Are you planning to buy your first or second investment property and have questions about getting financing? We offer rental investors innovative financial products to help them obtain the cash needed to build robust rental portfolios.

We have actively been helping clients refinance their rental properties at good rates and terms. Our asset based lending products offer 75% LTV and we even take into account full appraised value of your home during the finance. You can truly unlock the equity in your home and walk towards profits.

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