The Top 3 Positives of Working with Hard Money Lenders Near you
If you have a low credit score or an income that is difficult to verify, you will most likely struggle to get a loan from traditional lenders such as banks. With hard money lenders, this is not the case. These are only concerned about the value of the property you use as collateral.
They are a convenient place to look if you do not want to go through the arduous process of examining your application, reviewing bank statements and income sources. Below we explore some of the positives of working with hard money lenders.
Quick Approval and Funding by Hard Money Lenders Near you
The biggest advantage of working with hard money lenders like Asset Based Lending is the speed at which the loan is approved. The loans are funded within 3-5 days and in some instances, within a day. This cannot be compared with the long days taken by other institutions such as banks, where a loan approval takes over a month. The lender is more concerned about the collateral, and if it’s viable in terms of value and easy disposal on default, it becomes easy to lend the money.
If you have been searching for hard money lenders near you, this is a great choice if you are an investor stuck with a project or in case the original lender pulls out. The loans are also perfect for emergencies where you want to invest in a high-return project, but the funds are not readily available.
Great Financing Alternative
Most Banks are risk-averse; hence avoid financing high-risk projects such as flipping and funding faulty projects. This could be properties with plumbing, foundation, and other issues. Some investors and homeowners use fix-and-flip loans to buy a property, renovate and sell at a profit. With the necessary repairs using the hard money loan, you can apply for refinancing from a bank. Generally, flipping is hard to finance, and hard money loans are a perfect option.
If well utilized, hard money loans can easily fund a high return property that can pay the remaining loan. The loans are also used to complete stalled projects and for quick home financing as a home buyer awaits approval for a traditional loan. If you have identified a property and are afraid of losing it due to high demand, this type of loan is a perfect choice.
Few Requirements and Flexible Terms
The main focus of hard money lenders is the property against which you are taking the loan, which is the collateral. They are rarely concerned about your employment or financial position. Unlike banks, they also do not take you through reviews such as credit reports, tax forms, and statements.
They are also flexible, and you can renegotiate the loan duration and repayment schedules. Unlike commercial banks, which have rigid policies, hard money lenders do not use the traditional lending process, which is almost replicable to all clients. Instead, they evaluate every project on a case-by-case basis. You also do not need to prequalify for a certain loan amount before approval. The loan is determined by the property’s worth. You do not need a great credit score, with most lenders approving applications with a credit score below 700.
Hard money loans are easily accessible to investors as they bring great convenience, especially if one has a stalled project. With good planning, you can enjoy the many benefits of these loans and the freedom that comes with minimal requirements, quick approval, and availability.