Important facilities provided by hard money lenders
What happens when you are short of cash? You can try asking your parents or your friends. However, what if the loan amount required is huge and urgent? Maybe for a medical emergency. It is not always possible for friends and family to lend such a huge amount.
That is the time when you will need the help of hard money lenders. You can get the loan quickly provided you have a property in your name which you would agree to keep as mortgage till the time you are able to repay the loan in full. This is the entire concept of hard money loans and hard money lenders that you need to know about. Be it for long term or short term loans, there are fixed interest rates on this type of loan and every loan requestor has to comply with that rate. If you think this is rather easy to manage, then you will be happy to know the advantages that hard money lenders have to offer.
- No evaluation of credit scores – one of the best reasons why hard money lenders are so popular is because they do not check your credit scores before lending you money. Unlike the traditional loan procedures where a detailed credit history of the borrower is evaluated, hard money loans do not have any such formalities. If the residential property or investment property you are keeping as a mortgage is equivalent or more than the amount of loan, then you need not worry about your credit history.
- Zero penalties – hard money lenders are only interested in getting their money back within the specified time. It can often happen that you make some quick money and want to repay the loan before the given period of time. Normally, banks or other financial institutes will charge a prepayment penalty. But, since hard money loans are provided by private lenders, you will not have to think about such penalties.
- Flexible repayment structure – when you get details of the loan terms, the first thing you want to see is the amount of money you have to repay on a monthly basis. That is not the case with hard money lenders. You will have the freedom to systematically structure the repayment. In fact, you will be given various options to structure the collateral release terms. The breakup of the collateral release and repayment structure is done in such a way so that it is beneficial both for the lender and the loan requestor.
Finding the best hard money lender
Many people think that hard money lenders are mythical characters that can never be found. Truth is, hard money lenders are not hard to find. Rather hard money lenders are looking for you just as hard as you are looking for them. The easiest way to find such a lender is by searching online. Specify your state name and you will get a list of all the certified hard money lenders in and around your area. There are many websites that comprehensive details about hard money lenders located in your country.
Important tips to get funded
Do you know the secret of how to get your deal funded by a real estate investor or as in this case, a hard money lender? Well, here are few tips that will definitely help your cause:
- Have a good deal in the first place – let’s face it, hard money lenders are not there to do charity. You should have a killer business deal or a rental property or something that would help profit the lender. You can go online and consult seasoned investors from various loan forums regarding the deal you have. If it is a good one, no one will be able to stop the funding.
- Be professional – funding for a hard money loan can be done instantly, but that does not mean you can just show up in front of the lender and ask for the loan. Your deal should look good on paper and for that, you need to make the entire thing look presentable. Organized spreadsheets with detailed business plan and pictures can help make the job easier. It is almost like writing a good résumé for a job interview.
- Be prepared to lose – at least pretend that you have something to lose. It can be your property or car or any other asset, but the lender should feel comfortable knowing that you have something to cry about if you are not able to repay the loan. That is one big factor about hard money loans that you need to keep in mind.
- Stay connected with the lender – paying attention to the lender is the easiest thing to do. He/she would love that you have a cordial and professional relationship with them. Try to do exactly what they tell you do. This will increase your chances of being funded over others.
As you can see, there are hard money lenders everywhere and it is not difficult to get a quick loan. Conventional money lending has a lot of official procedures that can be really time consuming. With hard money lenders, the concept is different. It is quick, easy and you have so many facilities that you could only dream of while borrowing money.