Hard money lenders are one of the most common sources of financial capital. Many prospective investors avoid this route because they believe they won’t be accepted or that the fees and rates are too exorbitant. Instead of speaking with a hard money lender and learning how they operate, they ignore them. Nothing can help a business expand quicker than the appropriate hard money partnership, especially if the investor specializes in rehabs and flips. Instead of wasting time looking for funds to fund a project, that time can be spent looking for the ideal project to work on. If you want to apply for private loans from a hard money lender, below are important facts you might not know about hard money loans.
Hard Money Lenders Say No Less Often
The most difficult hurdle for real estate investors nowadays is obtaining a loan from conventional sources such as banks or nationalized corporations to purchase a property. The reason for this is that traditional sources first check the borrower’s income, determine the loan amount based on the property’s assessed value, and then go through a series of procedures to award the loan. If things don’t go as planned, they flatly refuse. In contrast, hard money lenders do not insist on rigorous screening before granting loans. Hard money lenders only use the property as security before lending money to investors.
Hard Money Lenders Provide Convenience
People are willing to pay extra for superior services such as hard money loans due to their convenience. Low-interest business loans and other fees may entice investors, but the obligatory criteria discourage most borrowers. Hard money loans are preferred by real estate investors who dislike long and time-consuming processes. They may offer a little higher interest rate, but there is the certainty of receiving a loan for a limited period with no hassles of gathering and submitting documentation. Hard money loans are typically for a limited period of time (6 to 24 months), are interest-only, and are exclusively accessible for non-owner-occupied buildings.
Hard Money Lenders Approve Loans In a Matter of Days
On average, banks can take up to 30 days to approve a loan, which is a long time, especially for real estate speculators whose property values vary regularly. Hard money loans, which can be approved in a matter of days, are significantly superior. Instead of waiting for a loan for a single contract, investors should close several investment deals using hard money loans in 30 days. Hard money loans are a viable alternative to bank loans.
The main qualities that define the real estate business are speed, ease, and flexibility. That is where hard money lenders shine since they make it easy to apply for private loans, allowing investors to focus on more vital duties. Do you want to apply for private loans? Contact us today to get started on the process.