The finance world has lots of options these days, but with each one there comes a certain amount of risk. There are certain risks you should be prepared to deal with or accept when working with a California Private Money Lender.
Traveling overseas by plane is a lot like trying to work with traditional financing options. The process is doable and one you can get through, but it is going to take forever and could be very uncomfortable in the process (unless you are in first class and keep getting your champagne glass filled).
Traditional financing options typically do take a long time from the beginning of the application process to final approval. For some, the wait is reason enough to look for other options.
But for some, the wait is just the beginning of the frustration. They learn the hard way that when you apply for a loan there is no guarantee you’ll get it. After taking months to go through the process to just get rejected can be the most frustrating experience possible.
The possibility is another reason why many will forgo traditional routes and just seek out a California Private Money lender instead. Like private money lenders across the country, they are quicker and more likely to approve someone—no matter how questionable their credit history is.
However, with the ease and speed of a private money lender comes risk.
Beware The California Private Money Lender That Seems To Good To Be True
When you decide to go with any private money lender there are certain things you have to be prepared to deal with. For instance, since they do tend to work with people that cannot get approved for loans through traditional channels they will charge higher interest rates. It’s their way of being compensated for taking a chance.
At the same time, the lender will do everything they can to mitigate that risk by requiring a borrower to provide sufficient collateral and possibly even a deed to the property in the lender’s name or insurance in their name. Either could then be used to recoup their losses should a borrower default on the loan
The Trade Off With Private Money Lenders
Whether you are using a California Private Money lender or one in another state the benefits are easy to see—a borrower gets the money they want sooner rather than later. However, at the same time it is going to cost them much more (due to a higher interest rate) and they stand to lose everything should they have to default on the loan.
Then again, chances are the property they would have a deed to would be the same one a traditional lender would want to secure a loan. So essentially, a borrower is paying higher interest rates to get money sooner.
Is it worth it? Only the borrower can say for sure—and probably not until they pay back the loan or default on it.
Dennis Dahlberg Broker/RI/CEO/MLO
Level 4 Funding LLC
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701
About the author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true.
Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.