What Is The Most Important Factor When Doing A Private Money Loan?

The property itself! The most important thing about the property is the current value. Even homes that have been trashed or that have been neglected and are in bad condition we are able to lend on. As long as there is enough value in the home compared to the loan that is being done, it’s okay.  A great example of this was one hard money loan that we did on a property that had 3 units but one of them had burned down, leaving only 2 units left. We got an appraisal to determine the value of the property with only the two remaining units. There was enough value in the remaining units that allowed us to do the loans.

What Are the Benefits of Using A Private Money Lender?

There are many benefits to using a private money lender like ARC Private Lending. One of the benefits of using a private money lender (a.k.a. hard money lender) is that we can lend on properties that other lenders can’t touch. We have done hard money loans where the property had a manufactured home on it that wasn’t on a permanent foundation. Any mortgage company or bank would consider this is an unusual property, but we were able to come up with a solution to do the loan. As a private money lender, we can do a third mortgage. Another benefit is bad credit or little to no income documentation is not an issue whereas with a bank you are almost guaranteed to get denied. In addition, because we work with over 400 private investors we can get you the funds you need in a shorter time than most conventional loans.

What If I Can Make My Payment But Don’t Have The Right Documentation To Support That?

The ability to pay is an important part of any loan because we need to make sure that the borrower is not going to end up in foreclosure. It is vital that the borrower can make the payments and not lose their investment.
This does not mean that we have the same requirements as the banks. Banks require borrowers to provide very specific documentation to prove their ability to make payments, including tax returns, W-2 forms and paystubs.
Because we are not a bank, we can use less conventional methods of making sure someone can afford the loan they are getting. This is a pretty general statement but that’s because there are so many ways to do it.

I Have Bad Credit Can I Still Get Approved For A Private Money Loan?

The answer is YES! The first two parts are very important but the credit is not usually a big part of the decision to lend to someone. In many cases, we see credit that has been damaged by late payments, foreclosures, short sales and bankruptcies.  Sometimes people have bad credit because of a divorce, an illness or losing a job. Other times, their business went through a slump or things just fell apart. Regardless of the reason for bad credit, we don’t believe you should be prevented from getting back on your feet.  We have done loans for people who had great credit scores. We have done loans for others who had credit scores below 500 because the only accounts they had were sent to collections. We have also helped people who had no credit at all.  One hard money loan that we did was for a borrower who needed to pull cash out of a rental property so he could pay tax liens and child support. He had plenty of equity in his property but had no accounts that he had paid on time. Everything on his credit report was bad.

What If I Am Not Sure That I Can Get A Loan?

We are here to help!! Since everyone has a unique situation or challenge, we find out what yours is and figure out the solution to it. We don’t try to make a one-size-fits-all loan. Instead, we take the time to ask the right questions to find out what the problem is and what is preventing you from solving it. Then, we work with you to come up with a solution.

To get your questions answered call us at 707-543-1588! Or submit a contact form with some of the details of your situation. We would love to help you solve your problem.