Economic crisis, hard manic, and the like. Once every few years the global economy in general and the American in particular, ...
Economic crisis, hard manic, and the like.
Every few years, the global economy in general and the American economy in particular, enters into a recession and economic crisis that shares and shares the financial world in general and the real estate market in particular. If only we could foresee the next economic crisis, we would probably be preparing ourselves and throwing millions of dollars in real time. You are probably asking, how does the economic crisis relate to Hard Mani? Well, history shows that at the beginning of such an economic crisis, the public usually withdraws from the financial market (bond banks and the like), and so the banks do not approve and cannot approve loans, as the public has withdrawn its money from the financial bodies until the situation and understanding become clear. "Where this crisis is going". As was the case in the economic crisis of 2008. In the crisis in question, the banks tightened the loan and mortgage belt by 2010 (two years in practice). This has caused a major slowdown in the real estate market since real estate cannot be purchased without withdrawing a mortgage from the bank. If so, then how did many people still manage to purchase real estate in those years? Some investors bought real estate in cash and some with Hard Mani loans. How did a situation where Hard Mani Landers were willing to take the risk and give loans? Well, this question is divided into two groups of investors. One, some investors agreed to pay exceptionally high interest rates (around 18% annual interest rate excluding points) (points = price of setting up the loan facility). Hard mani Landers, understood that because banks tightened their belts and did not approve loans, they could raise interest rates in a "disturbed and murderous" manner because of the "monopoly" and the vacuum created in the "conventional" mortgage market (conventional mortgage = real estate mortgage). The other part of the population who received Hard Mani loans were those who had prior contacts, and previous transactions with Hard Mani Landers. Those who had prior contacts with the lenders were in some cases left with interest rates that preceded the economic crisis (12% annual interest rate excludes points), which in fact made their real estate transactions much more lucrative. It should be noted that a significant portion of Hard Mani Landers did not survive the same economic crisis, so it is worth trying to make connections with several Landers and / or brokers at the same time, to leave more options on the shoulders in the event of an economic crisis and a slowdown in real estate financing.
My recommendation is: even if you do not need Hard Man, it is worth taking even a short period (a month or two) just to have a relationship with Lender. In this context, I would like to point out that if you decided to take hard mani to create such a relationship, please note that you are not locked in a perennial peripheral and that closing costs are low, of course.
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In the crisis of 2008 the banks did not stop giving loans because the public withdrew the money, rather they stopped giving loans because most of them went bankrupt! Fanny Mae and Freddie Mack were nationalized by the administration, and all the banks that actually serve as Fanny Freddy's servicemen had no source of money!
Investors have always preferred hard mani, even in times of mortgages, because Hard Money understands the investor's strategy and has much less bureaucracy! During the crisis, hard mani also tightened the faucet!
Thank you for the information ?