Explore the benefits of taking a hard money loan


Hard money is borrowing money from investors or individuals who lend money depending on the property used as collateral. When traditional lenders do not approve loans, or loans requirement happen quickly, hard money loan is the only option.
Most loans need proof of repayment. Lenders are generally interested in the credit scores and the income available for loan repayment. If you have a good history of loan borrowing and repayment (measured through debt to income ratio), hard money loans Houston will be approved.

The Approval Process

Getting loan approval with traditional lenders is a slow process- with a lot of income and good credit scores. If there are negative items in the credit reports, this process might take longer and might not even get approved.

The lenders of hard money take an altogether different approach. These lenders lend depending on the collateral that secures the loan. They are not concerned regarding your ability to loan repayment. When you are unable to repay the borrowed sum, the lenders recover the money through the sale of collateral. The collateral’s value is more vital than the financial position of the borrower while extending a hard money loan.
A hard money loan is a short-term loan that remains from 1-5 years. You will not want to keep the loan much longer because the interest rates of hard money loans are higher as compared to the traditional loans.

Purposes for taking hard money loans

Hard money loans may not be good for all deals. When you buy a property and you have a good income history, good credit and there are not issues related to foreclosure or short sale, traditional bank financing is the best option when a borrower has time to go through a complicated and lengthy process. Hard money loans, Houston are good sources of financing when banks are not a good option or when you need loans for a short time-period. These loans are useful in the following cases:

·         Land Loans
·         Fix and Flips
·         Construction Loans
·         If a buyer has credit issues
·         When real estate investors have to act quickly

Borrowers needs for hard money loans

Hard money loan lenders are concerned mainly with the equity amount that borrowers have invested in a property, which shall be used as collateral. They are not concerned with the credit rating of borrowers. The matters such as the records of borrowers such as a short sale or a foreclosure may be overlooked once the borrower has adequate capital for payment of interest on the loan.
The lenders consider the plan of the borrower for the property. Borrowers should present a plan, which shows that they intend to pay off the hard money loan. This improves the value of the property and helps to obtain long-term loans.

Eligible properties for hard money loans

Borrowers get hard money loans, Houston for all kinds of properties such as residential, industrial, commercial, and land. Many hard money lenders specialize in a particular property kind including residential and they have a particular niche for a loan that they are comfortable with.
Most hard money lenders do not lend on residential properties occupied by owners as they have additional rules and regulations, however, there are others who are willing to overcome the paperwork with loan borrowers.

Conclusion

When you consider hard money loans, consider these aspects. They will help you make a good deal. The high-interest rates might be high. However, the benefits to get a loan quickly when traditional banks have disagreed outweigh the additional cost. Find out a few hard money lenders to fund your projects quickly when you need them.

Location: 11200 Westheimer Rd #150, Houston, TX 77042, USA

Popular posts from this blog

WHICH WAY OF MONEY LENDING IS MORE CONVENIENT WHEN IT COMES TO BUYING A NEW HOUSE?

Image
  Defining the basic needs of humans Basic needs of a human depends on only four main factors which are: food to eat, air to breathe, water to drink and a home as a shelter. But it is a fact that no human being is able to lead a happy life with only these four. Human beings are born with the nature to desire many other things other than these four basic ones: they want to look their best, they desire to buy new clothes, they desire to eat food that tastes great; in short you can say that they desire everything that seems good to them. Another thing that any human being desires desperately is to live in a dream house, or at the very least live in a house that is perfect in their own ways. However, buying and building a house or a property is not something which can be done easily. People take years and years to save the kind of money from which they can build themselves their dream house or even a normal house which they can call as their own. Financing a house is also good in a way
Read more

Your Primary Guide to Real Estate Investor Loans By Investor Lending

Image
  It’s the showdown of the century, an all-out battle royale, so to speak. The economy is behaving super-favorably towards the real estate market and everyone wants to invest now. With funding options still a bit on the limited side, it’s a battle between the different types of real estate investor loans in Dallas , Texas. On one side we have dependable options such as Mortgages and Home Equity loans, on the other, the more adventurous opponents, Hard Money Loans and Private Loans. So which deserves to fund your next investment, let’s take a look at their pros and cons. Mortgages Mortgages are government-regulated long-term real estate-specific loans. Pros ·          Offer the lowest interest rates on the market. ·          The repayment periods can be as long as 30 or even 40 years. ·          Have reasonable monthly premiums. Cons ·          Have a long waiting period for approvals due to strict government regulations ·          Involve a lot of background checks.
Read more

TIPS FOR GETTING REAL ESTATE INVESTOR LOANS EASILY

Image
 Financing your real estate investment ventures can be a bit difficult. The lenders who give loans for investment properties have various requirements and eligibility criteria that are different from getting a primary home. However, taking care of a few things ensure that you get the best loan for your investment property and that the process goes smoothly. Here are the things that you must keep in mind. Keep A Good Credit Score Whether you’re applying for an asset-based loan or for conventional mortgage loans, your credit score will be of importance. Lenders will check your FICO credit score, and utilize the middle score to find out your eligibility, down payment requirements, as well as the interest rate. You may get the mortgage with a credit score of low to mid 600. However, the lender may ask you to put more down payment and give you an interest rate that is above average. Employment And Income Documentations In Place Asset0based lenders won’t really worry about your employmen
Read more