Hard money loans are a great option for real estate investors needing to acquire financing for a property on a moments notice or have difficulty obtaining a loan through conventional financing. If you’ve been considering a hard money loan, check out our four steps to success below!
Start with the Right Lender
Not every hard money lender is the same. They vary in quality and in terms, so choosing the right one is important. The best firms in the industry offer quick turnarounds, decision times, reasonable rates, and terms that leave more than enough room for you to invest profitably. Even better, investigate the options available there before approaching your bank. You may save yourself a lot of wasted time, effort and money.
Choose The Right Property
Hard money loans aren’t right for every property. There are different property types and locations that make sense when looking for a property from both the investor and the lender. A Hard money lender will look to make a loan on a property which will have opportunity to make a significant profit. The real estate investor will look for a property that will help grow his investment portfolio and earn monthly rental income. In the end, the right property will ensure you as an investor the maximum loan to value for your investment.
Repaying the Loan
Hard money loans are also an option for those who may not have the best credit because lenders are willing to work with individuals who have impaired credit histories. Hard money lenders offer loans for poor or bad credit because, unlike a conventional lender, the loan programs aren’t based solely on your credit score. Hard money lenders will look at current portfolio and What matters to the lender is what you can do from this point forward, instead of what you’ve done in the past.
Assisting the Lender for Fast Closing
One of the biggest benefits of choosing a hard money loan is the speed of execution. Hard money lenders can typically fund your loan in days rather then waiting for weeks. With fast approval times, often in 24 hours, and minimal documentation, your lender will get the deal done in time to meet that fast approaching close of escrow. In order to achieve a fast closing, be sure to work with your hard money lender and get the required documents submitted in a timely manner and you will be signing loan docs that same week!
There are a range of hard money options in the industry with different qualifications and requirements. Finding the right hard money lender will ensure you have great success on all of your future real estate investments. Contact Hanson Capital today to find out how you can get a hard money loan on your next property!