Top Merits Of Hard Money Loans
Hard money loans are those loans that are not given by banks rather by other lending parties. There are so many hard money lenders out there who offer clients quick financial support at affordable rates. As the borrowing party, you will need to carry out vast research on the honor of the lender, however, as you conduct your research you will find that hard money lenders offer a great plus in your pursuit to find funding for your real estate financing venture. So what are some of the benefits of hard money loans that you can enjoy?
It is without a doubt that the main advantage of a hard money loan is the fact that people can get money approval after two or three days, as long as you have given out the papers that the lender has asked for. Hard money lenders are most keen to find out whether the property has great market value and that the stake of the borrower is at least twenty percent. Financing with hard money loans can be as fast as less than three days, unlike normal loans which take a month or more to be approved. When looking for hard money lenders, the main query should be how fast they can give you the funds you need for your project.
You enjoy supple payments with hard money loans, especially when you get a lender who is private as they can allow you to tailor-make your payment plans. You will not have such liberty when dealing with big lending commercial enterprises. Rather, you will be forced to accept the payment terms the lender has set without any negotiations. But, when dealing with a hard money lender, you can talk and reach an agreement about the payment plan that is best for both parties.
There are minimal requirements when getting funds from hard money lenders. Normal bank institutions will expect you to meet a number of essentials before giving you funds such as past records, loan ratings, among many other more. It is without a doubt that getting loans from a financial lending firm can be tedious. On the other hand, a hard money lender will not burden you with so many requirements before they approve the loan. For hard money lenders, as long as your property has at least twenty percent stake you can qualify to get the cash you are looking for.
If you get a loan from the bank, you will have to pay penalization if at all you pay the loan before the date it matures. Most hard money lenders will not charge you when you get cash early and decide to offset your loan, so you do not have to worry about paying back the loan early as there are zero penalties. When borrowing from big institutions, your previous credit history can have an effect on whether you get the funds or not. As for hard cash lenders, there is no a lot of importance on credit history, it could be weak and they would not care a lot. This is because they provide the loan based on the value of the asset.