Top 3 Reasons
To Get a Hard Money Loan
As we have learned before a hard money loan is a loan which is non-standard as it does not utilize a bank but rather a privatized money source. Don’t let the exclusion of banks startle you and dissuade you from using a hard money loan, in fact there are many reasons why utilizing a harm money loan is more profitable and a smarter decision in the long run. To help illustrate this point I have compiled what I believe to be the top three reasons a hard money loan would be a better choice then your standard loan.
- Bad / No Credit: Banks and other mortgage lenders are hesitant at best when lending to borrowers with little to no credit. In most cases they will simply deny your application and send you on your way without another thought. This is not the case with hard money lenders who in most cases are not concerned with your credit score as much as they are concerned with the value of the property being used as collateral against the loan. This allows borrowers with a foreclosure or bankruptcy on their record to get a loan much much easier.
- Speed: Often in the case of an auction or other situation which relies on the speed of your reaction and the ability to garner the money needed as quickly as possible, a mortgage closing may not be the best suited to help acquire the property. In these cases often times a hard money loan will be what can help you purchase the property in a timely manner rather then the month long process a standard mortgage loan can take.
- Sub-Par Conditions: Often the best values in real estate can be found in properties which were never finished or in need of some stage of repair. Whether needing simple cosmetic repair or a structural overhaul, banks and other mortgage lenders tend to shy away from projects such as this, but a real estate project like this is the forte of hard money loans.