Three Reasons To Consider Using a Hard Money Lender

With bank rates down at historic lows, many people may question the need to use a hard money lender for your financing.  I specialize in hard money loans in California and am going to look at five common reasons people have for using a hard money lender in today’s market.

One of the more common reasons these days to use a hard money loan rather than traditional financing is time.  There are many transactions where time is of the essence, but conventional financing can take 30, 45, even 60 or more days right now.  In some cases there is a particular reason why time is so important – a foreclosure date, a looming 1031 exchange deadline or other times a seller simply wants a shorter escrow.  Whatever the reason, the hard money loans we put together can typically close much more quickly than any conventional financing.

Credit is another common reason for a borrower to seek out hard money financing.  With the continued credit crunch, many institutional lenders are requiring spotless credit.  This can be especially true on commercial property.  While credit does play a role in hard money lending, it is not the deciding factor on whether or not we can put a loan together.  Even for the most challenging credit situations we can often find a way to make a loan work.  Equity in the property is the main underwriting factor, and for those who have been turned down for a loan through the banks, hard money loans offer a real financing option.

The third reason to consider hard money is simply the ease of obtaining a loan.  Institutional lenders can require massive amounts of paperwork.  This is especially true on commercial loans and loans for self employed individuals.  While hard money lending is not ‘no doc’ lending, it is nowhere near as cumbersome as many bank loans.  Whether a borrower does not want to collect the required paperwork or simply does not have it, hard money offers an option to get a ‘make sense’ deal done.

For more information, visit our California hard money loans page online, or give me a call directly at 877 462 3422.  I’m always happy to discuss your loan scenario, and can typically let you know with a quick five minute conversation whether or not I would be able to help finance your transaction.