It provides great advantages that are not typically available through large banks or lending institutions. Some of the advantages include:
Minimal conditions. To acquire hard money loans, a borrower needs to satisfy a short list of criteria while a bank has numerous set-in-stone conditions that require being met. The entire process can become drawn out and the borrower, in the end, might not be approved. On the contrary, these loans are very simple and straightforward. In case the hard money lender assesses that the target of the borrower real estate investment is a great value and the borrower has at least 20% equity to put into the deal, chances are, the investor will qualify.See more on Barrett Financial Group.
Hard money loans have a quick loan approval. You can have it approved far quicker than traditional banks or money institutions. In most instances, a borrower can obtain approval and financing within a week- mostly if requested documents are represented in a timely way The main reason hard money lenders can approve loans quickly is that of the short list of the needed documents and the smaller size of the company of the lender which must not deal with the corporate red tape that banks do.
They have a lenient credit history. It will also be more lenient with your credit history. In case you apply for loans from top financial institutions, one of the major factors they will look at is your credit. In case a borrower does not fit within the strict of a bank, chances for obtaining the loan becomes minimal. In the case of hard money lenders, credit history doesn’t matter the value of the asset and the equity of the borrower. Provided that both meet the expectations of the lender, you have a good chance of acquiring the loan.Read more on hardmoneylenderscalifornia.com.
Another important benefit is that there are no prepayment penalties. In case you take out your loan form a reputable financial institution, you would like in most cases you would be hit with a prepayment penalty in case you pay off the loan before the maturation date. You can evade this fees by choosing the hard money loans. It is not hard to get a hard money lender will to offer you money with no prepayment penalties baked into the term sheet.
In case you are real estate investment in your handy location, then it can be very simple to apply for because you will come across many lenders willing to offer them.READ https://en.wikipedia.org/wiki/Finance.