Do you suffer from poor credit? One-third of the citizens in the United States have poor credit. However, when you need money, you need money. How are you going to get the money you necessitate with bad credit? Even if a bank would loan you the money, they take a long time when it comes to processing any loan. You deserve a fast and easy way to secure a loan with as little hassle as possible. When you talk to hard money lenders, they can help you get the money that banks won’t lend.
Get Money When Banks Won’t Lend it to You
Have you been through a foreclosure? What about filing for bankruptcy? Both can lead to bad credit as well as other problems. A hard money lender, also known as a private money lender, focuses on lending money to people that would otherwise be turned down by a bank or other lenders. The process is much faster with less paperwork than traditional loans. Even though a hard money loan is easier to get, there are still a few requirements that you need to meet so you can qualify.
If you are self-employed, or have less than two years of employment history, you may find it hard to get a loan. Hard money lenders are more willing to give loans to people in those positions. You may meet every loan condition except for those two, which will stop conventional lenders from giving you a loan at all. Private money lenders can extend a short-term loan of one to three years so you can get the loan you want.
What Kind of Projects Are Hard Money Loans For?
Hard money loans are for many different kinds of projects that are otherwise difficult to finance elsewhere. Hard money lenders offer loans that a conventional lender has no interest in when it comes to financing. Perhaps you need a short-term loan. A bank’s loan model is set up for long-term loans that last over 12 months since they are lenders that are extreme-risk adverse. Short-term loans are considered to be riskier. With such a strict lending criterion it can be difficult to get a quick loan for less than 12 months from a bank. Hard money lenders can provide borrowers with loans without the types of issues conventional bank loans present.
What Do Private Money Lenders Look for in a Borrower?
Once you’ve decided to use hard money lenders, you need to know what you should do to get loan approval. You may need to have a down payment ready to help the process. If you have equity, this can be used as well. You may need equity in the property, a reasonable exit strategy, enough cash to afford monthly payments, and experience with hard money loans before you can get a hard money loan. Since there are not as many requirements in regards to this type of loan, it can be easier to qualify for financing. A great benefit for seeking this kind of loan is how fast the loan itself is approved and funded.
Purchase a Home That Needs Work Using Private Money Loans
You may have your eyes on a home that needs work. While some lenders would not lend you money for this type of home, others are more than happy to do so. As long as the home is owner-occupied, you can get owner-occupied loans. This will give you time to repair issues. Once those issues have been fixed, you can then turn around and refinance with a conventional lender to lower the cost of the owner-occupied loan.