In simplest terms a hard money loan is a way to borrow money without using a traditional lender.
If you have ever gone through the approval process of a traditional lender then you are already aware it is a painfully slow process. This is even the case when it comes to borrowers with platinum credit scores and plenty of income. And, if you have any negative marks on your credit or not enough income to please your lender then you are in for an even worse ride.
Hard money loans are loans that come from private investors. These investors lend their money based on the property you want to purchase as collateral. Hard money loans happen quickly; typically only taking 24-48 hours for approval. Many borrowers turn toward hard money lenders when traditional lenders don’t approve them.
All lenders require proof that the loan can be repaid. Traditional lenders are interested in your credit score, your income and your job security.They look at your debt-to-income ratio; and if all that looks great then you’ll be approved for a loan. You’ll receive your money anywhere from 45 days up to 90 days. Although, you will get the best interest rate using a traditional lender, it will not happen instantly. Hard money lenders work differently than traditional lenders. They lend based on collateral securing the loan. If anything goes wrong and you are unable to pay they simply take the property. To a hard money lender your collateral is more important than your finances and credit. Hard money loans are typically more flexible than traditional loans. Hard money lenders do not use a traditional underwriting process. They look at each deal individually; this allows the terms to be much more flexible than a loan from a bank or credit union.
There are countless benefits to using a hard money lender versus a traditional lender.
Most people who have gone through bankruptcy or foreclosure, even have a low credit score, feel like they are stuck. A hard money lender can work with you regardless of your situation. Hard money lenders are real people; people you can speak to on the phone and stop by the office—unlike traditional lenders where you are dealing with different teams of people. A hard money lender wants to know your story and can work with you to make your dreams become reality; whether it’s to fix-and-flip a home or you need commercial real estate help. These are typically short-term loans that run from two to five years. If you have bad marks on your credit, have run into any financial problems or you just need money quickly a hard money loan could be the answer for you.
Level 4 Funding LLC
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave | Austin | Texas | 78701
About: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 43 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.
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