Hard Money- Leverages Time as Well?
My husband and I own several rentals, all of which we have purchased with cash. But we have been re-evaluating how we may fund future deals. One of the major factors that we have been overlooking with hard money is leveraging time.
Instead of using say $100,000 in available cash to purchase a single property, I could take that same amount of money and get 3 or 4 houses with a hard money loan. Therefore I leveraged TIME as well as money, because it may be a little while before I have $100,000 in funds to purchase another house. Assuming the property cash flows, with rents higher in most areas because of a depressed retail market, I can use that extra money to pay down the 15 or 30 year notes quicker.
However, there of course cons when working with HML such as: Amplified Losses, High Closing Costs, High interest in the interm until can refinance and generating a loan rather than owning a property free and clear.
Curious as to what you guys think, thanks. Also wanted to ask for you HML guys what notes do you typically get on your houses 15 or 30?