What is hard money? When it comes to real estate this type of lending can facilitate the dreams of people that would not qualify for a bank loan. Potential buyers need to know how to choose a commercial hard money lender using common sense.
The crash of banks and other financial institutions eight years past has created extra challenges to the typical potential buyer. Since that time, banks have lowered the interest rates, but they have also raised the standards for borrowing. Many people without an excellent credit score want to buy or invest in real estate, but just cannot get a loan approved.
This unique type of lender simply identified a need and is capitalizing on the potential profit of filling that need. This is a win win situation, as both the borrower and the lender benefit. This type of lending will provide will provide a short term loan to someone who wants to purchase most types of real estate, residential commercial or land. Once the borrower has established a payment history and earned some equity in the real estate, he or she should be able to refinance to a lower rate mortgage.
The interest rates are not exorbitant. In fact they are often lower than the average home buyer faced less than ten years ago. Of course rates different, depending on the lender and the borrower. So it does pay to shop around for the best deal.
It is good to know the factors that can affect the interest rate. A quick internet search will show the rate charged varies from state to state. The proposed length of the loan makes a significant difference. Lenders will charge less for a one to two year loan than for a ninety day loan. Buyers who are flipping houses will naturally pay higher interest than someone who plans to live in the home.
Look for the HML that fits your needs and vise versa. Local companies may be more flexible than their corporate competitors. The most attractive feature of your loan will it will not require a down payment. Your future equity in your home can serve as a down payment when the time comes to refinance the mortgage.
Often people are paying so much for rent that they are not able to save for that down payment typically needed to become a home owner. Check the lenders' rating with the Better Business Bureau, a get started on your road to your dream home your or dream business of flipping houses. Together, you and a local HML can make it happen.
The crash of banks and other financial institutions eight years past has created extra challenges to the typical potential buyer. Since that time, banks have lowered the interest rates, but they have also raised the standards for borrowing. Many people without an excellent credit score want to buy or invest in real estate, but just cannot get a loan approved.
This unique type of lender simply identified a need and is capitalizing on the potential profit of filling that need. This is a win win situation, as both the borrower and the lender benefit. This type of lending will provide will provide a short term loan to someone who wants to purchase most types of real estate, residential commercial or land. Once the borrower has established a payment history and earned some equity in the real estate, he or she should be able to refinance to a lower rate mortgage.
The interest rates are not exorbitant. In fact they are often lower than the average home buyer faced less than ten years ago. Of course rates different, depending on the lender and the borrower. So it does pay to shop around for the best deal.
It is good to know the factors that can affect the interest rate. A quick internet search will show the rate charged varies from state to state. The proposed length of the loan makes a significant difference. Lenders will charge less for a one to two year loan than for a ninety day loan. Buyers who are flipping houses will naturally pay higher interest than someone who plans to live in the home.
Look for the HML that fits your needs and vise versa. Local companies may be more flexible than their corporate competitors. The most attractive feature of your loan will it will not require a down payment. Your future equity in your home can serve as a down payment when the time comes to refinance the mortgage.
Often people are paying so much for rent that they are not able to save for that down payment typically needed to become a home owner. Check the lenders' rating with the Better Business Bureau, a get started on your road to your dream home your or dream business of flipping houses. Together, you and a local HML can make it happen.
About the Author:
Tom G. Honeycutt is a full-time real estate entrepreneur in Atlanta, GA. Tom helps readers by providing practical and useful knowledge to better understand lending choices. If you are looking Commercial Mortgages Lending Brokers | Atlanta, GA He suggests you check out the website iFund International.
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