Hard money loans are getting lots of press these days as the industry emerges from long-ago reputations of shady lending into a powerful, viable lending choice for those with real estate owning aspirations who need help in achieving their dreams.
You may be wondering what a hard money loan is, and wondering whether or not a hard money loan is right for your individual real estate borrowing needs. We’ll cover the topic of whom a hard money loan might be right for in this article.
What is a Hard Money Loan?
A hard money loan is a loan funded by a company that has different qualification parameters than a traditional residential or commercial mortgage loan company does. Today’s reputable hard money lenders consist of private investors or private investing companies that are willing to take risks on loans that traditional lenders are often not able to approve due to government regulations or strict lending guidelines.
Hard money loan applications are usually approved much faster and funds are distributed much faster than with traditional mortgage lenders, making hard money loans the perfect solution to many property ownership dreams.
Is a Hard Money Loan Right for You?
Hard money loans may not be right for everyone, but they do have the potential to be a powerful investing tool for many who wish to own residential or commercial properties. Here are some scenarios in which a hard money loan may be right for you.
You’ve Been Turned Down by Traditional Mortgage Lenders
If you’ve been turned down by traditional mortgage lenders it might be a wise move to consider contacting a reputable hard money lender to see if they can provide the funds you need. Since hard money lenders are funded by private investors, they aren’t held to the strict guidelines that traditional mortgage lenders must adhere to.
You Need to Close on Your Property in a Hurry
Whereas traditional mortgage lenders can take weeks to fund a deal, it’s not uncommon for reputable hard money lending firms to be able to close on mortgages within a few days. The quick turnaround from application to closing can mean the difference between cashing in on a great real estate deal and losing a property to someone who already has their financing in order.
Your Real Estate Transaction is Outside of the Norm
Hard money lenders are experts at assessing real estate transactions that are outside of normal mortgage lending guidelines, such as rehab projects, bridge loans, mezzanine loans and short sale properties. If you want to purchase a property that doesn’t qualify for traditional lending, consider using a trustworthy hard money lender.
Your Credit is Less than Perfect
Everyone makes mistakes, and hard money lending firms know that. If you’ve got some less-than-perfect issues with past credit, those past mistakes may disqualify you from getting approved by a traditional lender.
Hard money lenders use different parameters to assess loan approvals on, which means a past bankruptcy, foreclosure or other credit mistake doesn’t mean you can’t get a hard money loan.
If you’re looking to purchase a real estate property but are uncertain that traditional lending brokers can help you with your needs, consider contacting a quality hard money lender in your area today.
This article was provided by Inca Capital – a premier hard money lender in Arizona.