An owner-occupied property is the primary residence one lives. A property with up to four units, as long as the owner lives in one, is also considered an owner-occupied property. A vacation home that is outside of the county a person lives is also identified as an owner-occupied property.
What exactly is an owner-occupied loan? These are loans where the borrower lives in the property for which the loan is being obtained. There are tighter regulations involved and longer waiting periods for mortgage loan approval when working with a traditional bank. Banks also focus solely on a borrower’s credit worthiness and income when determining loan approval. Most people are familiar with the immensely long process and never-ending paperwork when trying to obtain a conventional mortgage. If the borrower has had a recent loan modification, is self-employed or has less than two years at their current place of employment a bank will likely deny their application.
For these many reasons many borrowers choose to work with a hard money, or private, lender. Not only do borrowers use Arizona Hard Money Lenders because of deficits or marks in their financial history—many times it is for the speed of the process. Arizona Hard Money Loans can also help assure the buyer they will not miss out on an opportunity due to losing the property to a cash buyer.
Owner-occupied Arizona Hard Money Loans are intended for short-term use—usually three to five years maximum. The rates on an owner-occupied Arizona Hard Money Loan can vary. Typically, they run between 9.99% to 14.99% with 2-6 points on the loan origination fee.
There are some standard requirements for Owner-occupied Arizona Hard Money Loans. Income must be verified by a 3rd party and hazard insurance and property taxes must be impounded for the first year. Depending on the lender they may be a prepayment penalty and there are disclosure laws that give the borrower awareness of the loan terms before documents can be signed. Most lenders require at least a 20% down payment—however, each lender is different in their terms.
There are several reasons a conventional mortgage may not work for you. However, that shouldn’t hinder you from buying if the time is right. Arizona Hard Money Lenders can give you many options and will help you determine which one is best for you. Don’t give up on what you want because the bank said, ‘no.’ Banks are not the only options and many times they aren’t the best option.
Level 4 Funding LLC
Hard Money Lender
Hard Money Loans
Hard Money Loan
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis Dahlberg Broker/RI/CEO
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave | Austin | Texas | 78701
About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 43 years. They have 2 beautiful daughters and 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.