Debts are dreadful. It stocked you up into a state that you can no longer control your own money. Those credit card interests, loan interests and monthly payments are just too onerous and it will kill you little by little. Sometimes, it kills you literally. Nevertheless, not all debts are bad, there are debts that are good actually. And that is if only if, you know when the right time to get one and where to get it from.
One good debt is the hard money loan. Yes, paying an 18% interest is not a child’s play but when dealt properly, it helps you advance in your fix and flip business deals.
When there’s a nice property that you can get for a very cheap price in an auction but you don’t have the money, will you just let that chance pass? Of course not! That’s why hard money loans are made, to help you in this kind of situation. This is a situation where you can use a debt for something even better than good.
Don’t pas up on good deals and make use of hard money loans. Buy a nice property using your hard money, have it repaired and sell it for a more profitable price and voila, you just turn a few thousand bucks richer. For example, you loaned $100,000 hard money. You can buy a property worth $90,000 and keep the remaining $10,000 dollars for all the repairs and property improvements. After some time, sell the property and closed the deal at least $140,000. After closing, paying origination fee and the 18% interest to the lender, you can net a profit of more or less $20,000 in just a couple of days. Not too bad for business, huh?
See, this is one great example of using debt into something good. Actually, loans are made to help but you need to deal with the best lenders. Not everyone is here to help and some are just made to bankrupt potential businessmen. So, make the best deal. Try your luck and take a risk. Start with a hard money and keep on boosting as the time goes by.