If you’re seeking financing for real estate projects, not many options are as benificial as hard money loans.
Hard money is a short-term, alternative loan. This type of loan is issued by private lenders. Unlike banks and other conventional lenders, a hard money loan is backed by the value of a real estate property than the credit worthiness of an investor.
Hard money loans carry interest rates higher than bank loans. That being said, these loans provide a number of benefits over traditional loans to investors. This is particularly true for investors with poor credit histories who have failed to acquire bank loans.
Here are some ways in which a hard money loan can help you finance multiple real estate projects:
Quicker Access to Funds
If you need loan approval within a reasonable amount of time, look no further than hard money financing.
Banks and traditional lenders take a great deal of time screening applicants. They can take several weeks or months to verify a borrower’s loan application, financial and personal data, etc. to determine their worthiness.
On the other hand, hard money loans can be acquired within a few days, depending on your lender. This provides investors the opportunity to secure cash for funding multiple projects.
Flexible Terms and Conditions
If you have bad or low credit, there is a great chance you might not qualify for a bank loan. As mentioned above, banks and traditional lenders verify an applicant’s credit score, financial statements, etc. to figure out their financial worthiness.
Even if you end up getting a loan, you may be charged excessively high interest rates. Financial institutions are regulated by banking and governmental policies. Therefore, conventional and bank loans have much more rigid terms and conditions than hard money loans. The terms and conditions of hard money loans can be negotiated between the lender and borrower.
No Prepayment Penalties
Hard money allows an investor to repay the loan before the maturity date. Unlike bank loans, you won’t have to worry about a prepayment penalty with hard money. Many investors secure additional loans to repay the previous hard money loan.
For more information on hard money loans, get in touch with us.
Harper Financial is a reliable commercial lender offering hard money loans at great rates to new and savvy real estate investors across the country. In addition to hard money, the company also provides investors with bridge loans, foreclosure workouts, partner buyouts, rehab / renovation loans, bankruptcy trustee payoffs, reaffirmed mortgages, non-reaffirmed mortgages and confirming commercial loans.