Hard money loans are very similar to bridge loans. Bridge loans typically have similar criteria for lending. They also have similar costs to the borrower. The primary difference between a hard money commercial loan and a bridge loan is that a bridge loan frequently refers to a commercial property or investment property that is in transition. The property may not fully qualify for traditional financing yet. Hard money commercial loans refer not only to asset-based loans with a high interest rate but also loans for a financial situation that is possible distressed. Examples of this include cases where someone is arrears on an existing mortgage or where bankruptcy and foreclosure proceedings are already in process.

Hard money mortgages, both commercial and residential, are made by private investors. They typically make loans only in their local areas. The credit score of the borrower is not important because the loan is secured by the value of the collateral property. The maximum loan to value ratio is 65-70%. This means that if a piece of property is worth $100,000, the lender would give the borrower $65,000 to $70,000. This low LTV (loan-to-value) ratio gives the lender added security in the event that the borrower cannot pay and the lender has to foreclose on the property.

Commercial hard money lender programs are similar to traditional hard money loans in terms of the LTV requirements and interest rates. A commercial hard money lender is typically a strong financial institution with the deposits and abilities to make discretionary decisions on loans that are non-conforming. These borrowers do not conform to the standards of Fannie Mae, Freddie Mac, or other residential conforming credit guidelines. Since it’s a commercial property in question, the loan does not generally conform to a standard commercial loan guideline either.

Traditional commercial hard money loans are very high risk and have a higher than average default rate. Just like in a normal commercial loan, when a property owner defaults on a commercial hard money loan, he or she can potentially lose the property to foreclosure.

For more information on hard money lending, please visit http://www.pitbullmortgageschool.com.

Joseph Devine

List With Real Estate Brokers

Having decided that 1031 Tax Deferred Exchange is what you want, you must then list with a real estate broker all of your existing properties and also ensure that such list includes an agreement that clearly states that you are using your property to complete 1031 Tax Deferred Exchange.

To be sure, if you go in for 1031 Tax Deferred Exchange, you will then be in a good position to roll-over all of the monies you receive when you sell your investment property which monies in turn must be used to purchase one or even several similar (like-kind) investment properties. However, during closing the proceeds must be transferred to a Qualified Intermediary who will keep the proceeds from the sale till such time as these proceeds are to be used to buy new like-kind property.

As mentioned, 1031 Tax Deferred Exchange permits you to also defer your capital gains tax as long as the entire amount of money from the sale of a property is used in purchasing similar (like-kind) investment properties. Thus, this deferment is tantamount to getting an interest-free loan for the entire amount that you would have spent on the cash sale which means that you get to retain more equity which in turn makes it possible for you to obtain properties with still higher values while of course, using 1031 exchange.

However, 1031 Tax Deferred Exchange is only applicable as long as you sell real estate that is investment oriented and it won’t hold true if you are selling personal residential property. Also, the properties in question must be similar or more precisely like-kind which means that if you are exchanging real property then the two properties in question must both be real properties. In fact, there is also nothing stopping you from exchanging a single property for many properties or even buying a single property from the proceeds of many properties.

Gary K. Landry is the CEO of TIC Advisors, Inc. If you are looking for the most complete information on a 1031 exchange or TIC property ownership, then you should visit one of the TIC Advisors, Inc. websites: http://www.tic.com and http://www.ticadvisors.com

Future Primary Residence: A second home today, that may or may not generate some rental income, but its primary purchase was for future personal use as a retirement residence. FPR is different from a traditional second home in that it is being interviewed and mentored for the day it becomes a full time home.

Cottage: The home you dream of being at while you are in the office. If home is where your heart is, your heart is up at the cottage, by the lake, overlooking the valley, next to the town, deep in the woods, perched on a bluff with the most incredible sunsets and sunrises from your hammock.

Pied a terre: If your dream home is in a vibrant city centre, with the vibe of culture at your doorsteps, then a pied a terre may be in your future. Typically a small, basic housing style – Besting suggests these properties are getting more luxurious in amenities and services.

Traditional Condominium: A cottage with less maintenance and a gardener who trims and weeds while you are back at the office. Legally a condominium is an ownership interest in a block of air, from painted wall to painted wall, and a right to use common areas owned by you and the other condo association owners. This is a form of ’shared ownership’.

Condo Resort Residence: A condo within a luxury resort, where you get a gardener plus pool boys, valet, and hotel amenities. Condo resort residences are typically not rented as part of the hotel rental program and are often in a separated area from traditional hotel or resort guests.

Condo Hotel: A condo resort residence within a hotel, rented nightly by the hotel management team while you are back at the office. Looks and feels like a condo, with multiple rooms, typically larger than 600 square feet, all amenities and services of the hotel.

Hotel Condo: Legally a condo within a commercial hotel, looks and feels like a hotel room or suite. Typically smaller than 600 square feet and does not have a kitchen. Often used as a pied Terre, a shorter stay vacation or second home, or a base camp for luxury living. Comes equipped with hotel rental program when you are back at the office or in your other hotel condo getaway locations.

Deeded Timeshare: Shared real or deeded real estate ownership and use rights of real property for a specific period of time. Often in vacation or resort markets. Most often refers to 1/52 share or 1 week of ownership rights. When sold as 1/52 share, the real estate value is often diluted by as much as 50% – i.e. a furnished $250,000 whole ownership condominium, which is converting and sold as timeshare will be sold at $9,600 per week ($9,600 x 52 = $500,000). As much as 50% of the retail cost of a timeshare covers sales, marketing and management expenses, because timeshare is more than real estate ownership it is a lifestyle product. $10 billion in timeshare was sold in 2006, up from $8.6 billion in 2005, this is a booming market.

Un-deeded “Points” Timeshare: Same as deeded timeshare, except the consumer receives a ‘right to use’ a property for a specific, typically long-term, period of time – i.e. 1 week of use for the next 10 years.

Vacation Clubs: Functions similar to a timeshare, club management buy timeshare interests from several resorts and then offers this time to club members. Club members do not get property deeds, but they do enjoy large discounts on vacation housing costs. Clubs are growing in popularity.

Fractional Ownership: Timeshare in bigger slices of ownership, and therefore more real estate at a value closer to whole ownership pricing. Fractional is typically ¼ to 1/13 share of deeded real property ownership. Fractional owners get a deeded ownership interest in a particular condo unit or property, when they come for their use time, this is solely the unit they use. ‘Why buy a whole pie if you only want a piece?’

40,000 households own fractional real estate, this is only 1% of the top earning households, fractional is poised for substantial growth.

Non-Traditional Fractional (NTF): Fractional shares smaller than 1/13 to 1/26 share. Bigger shares than timeshare, smaller than traditional fractional, 3.5 weeks or 2 weeks of use. NTF is often found in private residence club structures.

Private Residence Club: Fractional ownership in a resort project, with a deed to a particular condo, but with the right to use any available condo in the resort or a number of resorts within the club association.

Bob Waun is the author of a new book on this trend called: “Besting” http://www.betternesting.com . He is CEO of Vacation Finance, America’s First Second-Home Lender and a leader in the resort and second home industries.

If your company has itself a sought partnership address on the north side of the Island, then the first place to look for an apartment in Hong Kong is among the many buildings on offer here.

If you’re traveling solo, business as a couple without kids, then a rental apartment in the area bounded by Sheung Wan, Causeway Bay and the Mid-Levels is a great place as you’ll have maximum convenience with public transport, work and nightlife all within easy reach.

To keep the budget under tighter control you could look at rental apartments further out from Central, to the west around Kennedy Town or east towards Chai Wan. Renting a Kennedy Town apartment will keep you within a short taxi or bus ride of Central, whereas a Chai Wan apartment is convenient to the eastern most stop on the MTR line. Both are still convenient, just with less Expatriates around- keep in mind that not all Hong Kong grocery stores are created equal.

As a couple with children, you’ll probably tend more toward apartment rentals in Mid-Levels and Happy Valley, depending on your size requirements and preferences. All still on the north side of Hong Kong island, only a little more Expat and family oriented.

Keep in mind though that some of the apartments in these areas will not have balconies, car parking or outdoor areas (top floor apartments may have roof access). You may have a gym included in the apartment building. Pets may or may not be allowed depending on the property owner or building regulations, and you’ll find the only places to exercise a larger dog business the walking trails up to the Peak.

Looking for space and the budget is not a factor? Then include The Peak in your search. Long famous as the most luxurious real estate in Hong Kong you will find many spacious villas and apartments in this area. Views, carparks, and all the trimmings you would expect from the most sought after location for Hong Kong apartments.

Once you have decided on a location or two, you need to know how the local market works. You will find this and other important information, including rental listings, available in our Hong Kong Apartments section. ExpatFlats also invites real estate agents and property owners looking for an easy way to market to the Expat community to test drive a free account at http://www.ExpatFlats.com
James Dylan is the managing director of ExpatFlats Limited, Hong Kong’s leading independent property portal.

If your company has itself a sought after address on the north side of the Island, then the first place to look for an apartment in Hong Kong is among the many buildings on offer here.

If you’re traveling solo, or as a couple without kids, then a rental apartment in the area bounded by Sheung Wan, Causeway Bay and the Mid-Levels is a great place as you’ll have maximum convenience with public transport, work and nightlife all within easy reach.

To keep the budget under tighter control you could look at rental apartments further out from Central, to the west around Kennedy Town or east towards Chai Wan. Renting a Kennedy Town apartment will keep you within a short taxi or bus ride of Central, whereas a Chai Wan apartment is convenient to the eastern most stop on the MTR line. Both are still convenient, just with less Expatriates around- keep in mind that not all Hong Kong grocery stores are created equal.

As a couple with children, you’ll probably tend more toward apartment rentals in Mid-Levels and Happy Valley, depending on your size requirements and preferences. All still on the north side of Hong Kong island, only a little more Expat and family oriented.

Keep in mind though that some of the apartments in these areas will not have balconies, car parking or outdoor areas (top floor apartments may have roof access). You may have a gym included in the apartment building. Pets may or may not be allowed depending on the property owner or building regulations, and you’ll find the only places to exercise a larger dog being the walking trails business to the Peak.

Looking for space and the budget is not a factor? Then include The Peak in your search. Long famous as the most luxurious real estate in Hong Kong you will find many spacious villas and apartments in this area. Views, carparks, and all the trimmings you would expect from the most sought after location for Hong Kong apartments.

Once you have decided on a location or two, you need to know how the local market works. You will find this and other important information, including rental listings, available in our Hong Kong Apartments section. ExpatFlats also invites real estate agents and property owners looking for an easy way to market to the Expat community to test drive a free account at http://www.ExpatFlats.com
James Dylan is the managing director of ExpatFlats Limited, Hong Kong’s leading independent property portal.

The bank foreclosure takes a while and a wise investor will be aware that there is a period in between the time the bank will actually taken possession of the property. This period is known as the pre foreclosure period. During this time the property owner can attempt to sell the home in order to preserve his good credit standing. For the investor wishing to buy the property it becomes a very lucrative deal as many homeowners need to sell the property so quickly that they will give great deals on the sale of the home.

If the property was not successfully sold during the pre foreclosure period, the bank will take over the title of the property and repossess the home or other real estate property in question.

When a bank foreclosure has occurred the bank will not wish to keep the property that it now owns for several reasons:

• Banks are moneylenders; they are not real estate owners.

• Having possession of property on their books shows bad decision making on their part resulting from lending money to consumers who are unable repay the loan.

• Banks lose money on the ownership of repossessed homes. They must maintain the buildings, pay taxes and insurance fees. The longer they own the property the more loss they incur.

• The bank will also want to recover the money lost on their bank foreclosure.

Since banks want to rid themselves of the foreclosed property as soon as possible, they too will sell the property thus, opening up a wise investment opportunity for an investor as well. The investor can obtain property at between 20 – 60 percent below the market value from purchase of a bank foreclosure.

A wise investor can search for bank foreclosures and choose the property that is right for his/her current needs and budget. There are several online sites that offer bank foreclosure listings. Not all provide current listings. Bankforclosuresales.com will provide the most update bank foreclosure listings on foreclosure homes, commercial foreclosures, and government foreclosures. They charge a nominal fee but provide an excellent service.

Investing in a bank foreclosure home or other property is risk free, the deals are well below market value, and all liens on the property have been lifted. The investor is only responsible for the cost of the sale price of the property.

Jeremy Lawrence is an independent business person and Niche Marketer. See his website – http://bestwaytostopforeclosure.info – to download a free report on Everything You Always Wanted to Know About Foreclosures

While the widespread fraud schemes and tactics utilized were sometimes elaborate and some times crude, all were at least initially successful, if success means a house to own and/or money in your pocket. How did this happen? People who could never have afforded homes with a conventional loan were provided the opportunity to become property owners with no money down and no proof of income. This created an opportunity to speculate in the real estate market with minimal or no monetary risk. And, with no fear of being sued, criminally charged, or losing licenses to operate, many mortgage brokers and real estate agents went to extremes putting people in homes they could not afford. All the prospective home buyer had to do was sign on the dotted line. Fraudulent conduct rose to epic proportions. 

To comprehend the blatant fraud that was being committed, and ignored by the California Department of Real Estate, (D.R.E.) district attorneys and other police agencies, you only have to ask yourself a simple question. How many people do you know who have walked into a Ferrari dealership and were handed keys to a $180,000 Highway Patrol- attention-grabbing red F-430 after they told the salesperson, “Hey I want to buy that mean red machine, but I don’t have a down payment and my wife and I earn a combined annual income of less than $20,000″? Then, how did a California couple employed at a sandwich shop earning a combined annual income of $35,360 purchase a $628,000 home without a down payment and with one hundred percent financing? Or, how did a California seasonal worker purchase a $598,000 home with no down payment and with one hundred percent financing while earning $8.76 per hour at a lettuce packing shed in Salinas? How did the lenders expect the lettuce packer and sandwich makers to meet $4,000 plus monthly mortgage payments, or did they? And, how did the lettuce packer and sandwich makers actually think that they could afford even the teaser mortgage rates of $1,800 per month, or did they? The sandwich makers and the lettuce packer are not exceptions to the rule, but rather the majority. And they are real people; they were my clients. 

The majority of the news media, economists, and legislators either do not have a concept as to what actually occurred in the mortgage crisis, or they are intentionally misleading the public. A couple years back, I predicted a severe recession. I had been asked to speak at several functions by the California Association of Mortgage Brokers, National Association of Hispanic Real Estate Professionals, and the Santa Cruz County Board of Realtors. The attendees laughed when I made the predication. The housing market was still hot but, suspiciously at the same time, homeowners were defaulting on their mortgage at a record pace. The real estate professionals’ general response was that the problem was temporary and that in a year things would be back to normal. They didn’t want to hear that the houses were so overvalued that even middle class persons could not afford them, especially since the majority of their clients were working class people making well below middle class wages.    

Easy money and inflated appraisals are the reason why property values spun out of sight and then rapidly declined and are still declining. Property values were exaggerated for several reasons. The mortgage brokers that people were relying on to help them had a vested interest in closing the deal at any cost because they were going to make money regardless if the borrower had the means to repay the loan. The greater the loan amount, the more money unscrupulous mortgage brokers earned. People with little or no money began purchasing homes at a record pace, some offering to pay more than the asking price, further inflating property values. As property values increased, owners soon resorted to refinancing constantly. Appraisals were falsified so borrowers could pull out cash, most of the time leaving homes with little, if any equity. My clients routinely pocketed $50,000, $60,000, $70,000 or more in refinance transactions months after purchasing properties. These were the very same people who couldn’t even afford a down payment or the mortgage payments. Some of the cash was spent on vacations and vehicles, some invested in other real estate.    

The escalating bidding war to purchase homes has ended leaving home values in question. Ask yourself what your property is worth today. The answer is, what you can sell it for, and more likely than not, your property will have to compete with a nearby home in foreclosure. With so many foreclosures and a tightening credit market, prices continue to fall on a daily basis. But, let’s say you can afford a ten percent down payment on a $400,000 home. Why would you purchase the home today when there is no indication when property values will stabilize? You could easily loose the $40,000 down payment in less than six months. When will property values stabilize? Knowing what actually occurred, it will be at least five years before we hit the bottom.

So most of this you have probably heard before. But I learned something more by looking at hundreds of loan applications and documents given to me by clients claiming they were lied to and cheated by their mortgage brokers. But first you should ask why people come to me, a private investigator, instead of to an attorney or public agency for assistance?

The majority of district attorneys and police agencies has little, if any, knowledge of mortgage lending and real estate practices and regulations, and therefore was deemed worthless even by actual victims of fraud. For example, in 2007 the Santa Clara County District Attorney’s Consumer Fraud unit had not made one arrest for fraud and/or predatory lending practices in foreclosure related cases. This is the norm in most counties throughout California. The California Department of Real Estate (D.R.E.), until just very recently, would not even respond to complaints of unlicensed activity. Their response was that they only regulate licensed persons. If the individual didn’t have a license, what could they do? Yet in 2006, ignoring my calls and written complaints, they went as far as providing a license to a previously unlicensed woman who had been a “loan consultant” on one of my fraud cases. I reported her for fraud to both the D.R.E. and Monterey County District Attorney. I provided them with a 7 page investigative report with verification that she had conducted business without a license. She had even paid restitution to one of my clients after being caught threatening her with deportation if the client complained about the loan. Less than six months after I submitted my report, the loan consultant was provided a real estate license to operate. 

So I turn back to my question, why did the people come to me, a private investigator? After interviewing and re-interviewing people, and checking and cross checking documents, I came to the realization that my clients believed that a threat of an investigation would coerce mortgage brokers, or other parties to the loan transactions, to give them the money promised to them in their deals. In a nutshell, it’s hard to recover damages if you’re in on the fraud. 

In one case that I was hired to conduct an investigation, an unemployed eighty-year-old blind and diabetic man was unknowingly sold a $680,000 home by his granddaughter’s husband who had refinanced the home several times and had depleted all of the equity in the process. With the assistance of an unlicensed “Loan Consultant” and unscrupulous mortgage broker, they falsified the grandfather’s date of birth (he was now 45 years old) and his income (it was stated he earned over $100,000 as the owner of a bookkeeping service) on the loan application. The appraiser inflated the value of the home. The mortgage broker and his unlicensed “Loan Consultant” profited almost $20,000 in loan fees, and over $27,000 (4%) for selling the home. The granddaughter’s husband profited $80,000 in the sale. The eighty-year-old grandfather, who had nothing to lose but his credit, immediately lost the home in foreclosure. The granddaughter’s husband became enraged when he determined that the mortgage broker charged him a fee to sell the home. He wanted all or a portion of the $27,000. The granddaughter’s husband was the client who came to me claiming the mortgage broker had wronged him.

There are the clients that “loaned” their credit and signatures for a price, and then complained when they did not receive the payments promised or when their credit was ruined because the buyers they had never met failed to make the payments. Every client that came to me crying predatory lending had claimed that they earned over $100,000 as business owners on their loan applications. But in reality they were maids and maintenance men, dishwashers and sandwich makers earning minimum wages. They came to me claiming they had been deceived about the payments. But the real problem was that they had been led to believe that they could refinance in a year when the payment on their adjustable rate mortgage adjusted upward, and they suddenly found themselves with a three-year prepayment penalty. Their loan consultants had made extra money putting them into a prepayment penalty loan, but neglected to explain to them that they would be penalized when they refinanced. But the clients didn’t stop and think about the fact that they had falsified their incomes on their loan applications, and that they should never have been given the initial loan, much less a refinance. These are just a few of the scams, believe me there are many, many more.

Why did lenders began giving out money like drunken sailors? I theorize that an attempt was made to forestall a recession in 2002, and resorted to a ponzi-loan sharking type scam so initial investors in the know would profit millions of dollars. The others, the flippers, and the ones that were misled to believe they could make a quick buck from the American Dream, were left holding the bag. What was not taken into account and anticipated was the financial devastation that the fraud would leave in it’s wake.

What should alarm every tax payer who will help bail out these criminals is that few lawsuits are being filed and few people are going to jail. Although, we may never experience this type of fraud fiasco again, both the real estate and mortgage industries are in dire need of regulatory changes. California’s Department of Real Estate should also be reorganized. The D.R.E. should be empowered to settle and mediate claims of predatory lending and fraud. And, they should also require licensees to be insured and bonded, and that their license is printed on all  business cards.  Will  this prevent  fraud completely? Absolutely not, but it will deter the conduct that has been prevalent in the industry.

I realize that my observations and opinions will be questioned and maybe create a big brouhaha, because they will ask  what do I know? I am only a gumshoe.

Rendon is one of dozens of Californian homeowners who are fighting their tax burden with the help of an affordable assessment appeal agency. Here’s what you can do to start saving up to thousands of dollars this year.

1. Don’t Let the County Assessor Nickle and Dime You

Despite that some County Assessors have sent thousands of homeowners tax reduction notices this month, homeowners are actually eligible for higher savings than what has been granted. A typical automatic reduction granted by the Assessor is roughly $700, whereas property owners can save up to thousands of dollars more if they choose to file an appeal. Don’t settle for minimal tax reductions when you can save more. Remember, as much as 60% of homeowners are over-assessed and eligible for tax cuts, according to the National Taxpayers Union. This means that you can maximize your tax reduction by challenging your tax bill.

2. Find Out How Much You Can Save

Typical tax savings by way of appeals range from $200-$5,000. Depending on how much your property is assessed for, you can be in for pretty hefty tax cut. For example, if you purchased your home for $600,000 but it is now worth only $400,000 (it’s Prop.8 value), then you can save as much as $2,000 if you can prove that your property experienced a decline in value.

Some appeal agencies can conduct a FREE market analysis of your property and notify you of your estimated tax savings before you file the appeal or pay them to do it for you. Do not pay for a company to reduce your taxes without finding out much you can save first.

3. Do It Yourself or Pay Someone Else?

Because the Assessment Appeals Board does not charge a fee for filing appeal applications, homeowners can file their appeal applications without hiring appraisal experts. But the No. 1 reason why applications are denied by the Assessment Appeals Board is because homeowners make mistakes, provide inaccurate market information and offer incomparable home sales as evidence to reduce their taxes.

Caveat– once your application has been denied, the decision is final! You will have to wait an entire year to file another appeal or take it up with the Supreme Court to get a tax reduction. Don’t make this mistake. Save yourself the headache and hire market experts and appraisers to complete your application for you.

It’s also good to shop around to see what company offers to complete your application for the most affordable price. Some companies charge as little as $300 to do this and don’t offer a money back guarantee.

4. Put Up a Good Fight

When filing an appeal, the homeowner needs to know a great deal about the current market conditions, the value of his or her property and extensive knowledge of comparable properties. This information serves as evidence that you are being over-taxed. This process can be nerve-wrenching for homeowners

because the information is not easily accessible. Consider hiring an appeal agency to file your application, which will provide the Assessment Appeal Board with a detailed comparable analysis worksheet with the most accurate market information for your home.

5. Don’t Wait Until the Last Minute!

Depending on the county in which your property is located, you won’t have much time to file an appeal. For example, the deadline to file appeals in Orange County, CA is Sept. 15. But generally you have 60 days or less from the time your annual tax assessment was mailed to file an appeal and start saving money. Even if you decide to hire someone else to do this for you, the application process still takes time.

Don’t wait to start saving money– file an appeal today.

I recommend www.cuthometaxes.com which charges a low one time fee starting at $99 for tax reductions. They also provide a FREE market analysis to determine if you qualify for a tax reduction.

Happy savings!

Toni Shepherd is a graduate of Chapman University, where she received her bachelor’s degree in English/ journalism.