Hard Money Loans

Transactional Funding: A Flexible Solution for Real Estate Investors

Looking to secure a property's purchase before a swift resale? Transactional funding is the key. Ideal for "double closing" deals, this short-term loan provides the necessary liquidity to act on back-to-back transactions. With Larry The Lender's streamlined process, you can easily navigate the intricate pathways of investment property purchases. Whether you're flipping houses or bridging gaps, transactional funding ensures you're never slowed down by financial constraints. Trust in our family-owned approach and quick-close promise to fuel your next investment venture.

Transactional Funding Loans Details

Transactional funding loans, also known as same-day funding or flash funding, are short-term financing options specifically designed for real estate investors, particularly wholesalers. These loans facilitate back-to-back property transactions, enabling investors to purchase a property from a seller and sell it to an end-buyer simultaneously without using their own funds.

Transactional Funding: A Flexible Solution for Real Estate Investors 1

Loan Fees

The fees associated with transactional funding loans may vary based on the lender and the specifics of the deal. Typically, these fees include origination fees and interest charges. It’s essential to clarify these details with the lender before finalizing the loan agreement to avoid unexpected costs.
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Property Criteria

The property criteria for transactional funding loans primarily focus on the property’s market value and potential profitability. The loan amount is generally based on the purchase price of the property rather than its appraised value.
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Loan Terms

The terms for transactional funding loans are typically very short, often just a few days. This fits perfectly with the nature of back-to-back real estate transactions in which properties are bought and sold within a short timeframe. The loan is usually repaid once the end buyer’s funds have been received.
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Appraisals / Insurance

While traditional lenders require property appraisals and insurance coverage, transactional funding lenders often bypass these requirements due to the short-term nature of the loan. Nonetheless, it’s crucial for borrowers to understand the risks and protect their interests accordingly.
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Borrower Criteria

The borrower criteria for transactional funding loans can be less stringent than other types of loans because the loan is fully collateralized by the property being purchased. However, lenders may still evaluate factors such as the investor’s experience and the transaction’s viability.

Loan Overview

Loan Programs Type Commercial Loans Residential Loans Land / Lots Loans Fix / Flip Loans
Do We Offer Them? Yes Yes Yes Yes
LTV 70-80% 70-80% 0-50% 70-80%
Minimum Loan Amount $75,000 $75,000 $75,000 $75,000
Maximum Loan Amount $5,000,000 $5,000,000 $5,000,000 $5,000,000
Loan Term Offered 6 or 12 months 6 or 12 months 6 or 12 months 6 or 12 months
Interest Rate Offered 12.99% 12.99% 12.99% 12.99%
Points Charged 2 or 3 based on term 2 or 3 based on term 2 or 3 based on term 2 or 3 based on term
Pre-payment Penalty No No No No
Insurance Requirements Property, Windstorm Property, Windstorm N/A Property, Windstorm
Flood Insurance Requirements For Floodzone Properties For Floodzone Properties N/A For Floodzone Properties
Lending Area Texas Only Texas Only Texas Only Texas Only
Special Requirements Phase 1 - Loans > $1 million N/A Possible Survey N/A

What Is Transactional Funding?

Transactional funding, also known as same-day funding or flash funding, is a unique financial strategy primarily used in the real estate sector. It involves investors taking out very short-term loans to facilitate real estate transactions, often within the same day. This type of funding is especially beneficial for real estate wholesalers who aim to earn a significant profit on a same-day, simultaneous “double close” without requiring any money out of their own pocket. In essence, short-term capital investors borrow to complete real estate deals. It’s a creative financing strategy that involves a short-term loan borrowed and paid back usually within a day.

What Properties Qualify for Transactional Funding?

Both residential and commercial properties can qualify. This type of funding works well for short sales, wholesale deals, and property flipping. The most critical aspect is that the property is part of a back-to-back or simultaneous closing. This means that the wholesaler purchases the property from a seller and assigns the contract to an end buyer within the same day. The property itself should have a clear title and a ready-end buyer.

Who Should Consider Applying for Transactional Funding?

Ideal for real estate wholesalers, flippers, and investors who engage in simultaneous closings. It’s also suitable for those who wish to leverage their cash flow and minimize personal financial risk. If you’re involved in short sales, REOs, foreclosures, or auctions, you might find transactional funding beneficial. It’s a way to finance short-term needs, such as working capital or inventory, making it a viable option for startups as well.

What Sorts of Projects Are Transactional Funding Good for?

Perfect for projects that require quick, hassle-free, and affordable 100% financing. These include short sales, foreclosures, wholesale deals, property flipping, and other types of real estate transactions that can be closed within a day. This funding is also good for transactions involving distressed properties or properties sold at auctions.

Why Choose Larry the Lender for Transactional Funding?

Larry the Lender offers reliable hard money solutions across various sectors. With our quick, easy, and smart transaction funding, wholesalers can earn significant profits without ever using their own money. We understand the importance of speed in these transactions, and we strive to provide fast, hassle-free funding. Our team of experienced professionals is dedicated to helping you succeed.

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Benefits of Asset Based Lending Larry The Lender One

Benefits of Transactional Funding

It provides 100% financing, allowing you to keep your cash flow intact. It minimizes personal financial risk as you don’t need to use your own money. It’s quick and hassle-free, perfect for deals that need to close within a day. Moreover, it gives you the ability to take advantage of profitable real estate deals without worrying about funding.

Transactional Funding Loan Application

Applying for a loan with Larry the Lender is simple and straightforward. You need to provide details about the property and the deal, including the purchase and selling price and information about the end buyer. We’ll assess your hard money loan application quickly and let you know the decision so you can move forward with your real estate transaction.

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Transactional Funding FAQ

What is transactional funding?

Also known as flash funding, is a short-term financing solution designed specifically for real estate investors engaged in simultaneous buy-sell transactions — often referred to as “double closings”. The lender provides the funds needed to complete the initial purchase, with the understanding that the loan will be swiftly repaid after the property is resold.

How does transactional funding work?
In a typical transactional funding scenario, an investor enters into a contract to buy a property from a seller. The investor then finds an end-buyer and enters into a second contract to sell the property at a higher price. The investor uses the funds from the transactional funding loan to complete the original purchase, then immediately sells the property to the end-buyer. The loan is repaid out of the proceeds from the resale, and the investor pockets the difference.
Where can you get transactional funding?
Transactional funding is typically provided by private lenders or hard money lenders, like Larry the Lender. These lenders understand the unique needs of real estate investors and offer flexible, short-term loans tailored to facilitate double closings.
What are the benefits of using transactional funding?
Transactional funding offers several benefits. It allows investors to complete double closings without using their own funds. This can be particularly advantageous for investors who do not have sufficient cash on hand to finance the initial purchase. Transactional funding also eliminates the need for traditional bank financing, which can be time-consuming and difficult to obtain. Finally, because the loans are short-term, investors can avoid paying ongoing interest costs associated with longer-term financing options.
Are there alternative options to transactional funding?

Yes, there are several alternatives including traditional bank financing, private money loans, and hard money loans. However, these options may not offer the same speed and flexibility. For instance, bank loans often involve lengthy approval processes and stringent qualification criteria. Private and hard money loans can provide quicker access to funds, but they typically come with higher interest rates and fees.

Hard Money Lending Resources

Welcome to Larry the Lender, your trusted source for hard money loans. With years of expertise, we've become a leader in the hard money lending industry, offering tailored solutions to real estate investors. Our commitment to transparent, rapid, and accommodating financing has enabled countless clients to seize opportunities in the competitive real estate market. Let's dive into the details of our unique approach to hard money loans

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