Financing Options Available For Property Investors

The property market is currently the highest revenue earner. Investing in this market, unfortunately, requires a substantial financial commitment which locks most would-be investors out. Lack of finances, fortunately, need not be a hindrance for your property investment.

There are different financing options you can choose for your investment. Though most investors steer clear of these options to avoid getting stuck in a financial mess, this will not be the case with the expertise of an agency dealing with investment properties in Denver.

Here are some of the funding options the experts might recommend for your investment.

Bridging Finance

A bridging loan is a short-term option with a 1-36 month repayment period. Processing of a bridging loan will take 5-7 days. The loan is usually meant for property renovations or conversions and ground-up developments.  Most financiers will advance you 75% of your project’s entire cost or up to 60% of its GDV {gross development value}. To qualify for this financing, you should have a detailed exit strategy on how you will repay it.

Mezzanine Finance

This option works like a second property loan for investors with a primary one which covers most of their development expenses. You can use the loan to decrease the capital investment you put in your venture. Mezzanine financing can increase your total property loans to 70% of its GDV or 90% of the development expenses.

Development Finance

This financing is accessible to seasoned property investors. You can get up to 100% financing with this option though the exact amount will depend on your experience level and period spent in property investing. A private specialist property development creditor usually advances development financing through a finance broker.

The above options work best for different circumstances. Under the guidance of a seasoned property investment company, you can pick the ideal one for you. This way, the loan will actualize rather than kill your property investment dream.

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