Documents Required for Obtaining Commercial Loans from Hard Money Lenders

While every hard money lender for commercial loans is unique, there are often similar requirements regarding documentation. Be prepared and follow the lender’s submission guidelines.

Hard money lenders do not operate under the same restrictions that traditional lenders are under. Because of this, they are able to fund commercial loans in relative ease and with little documentation. It is a hard-asset based lending strategy that uses collateral to ensure the loan. While some lenders require certain standards regarding credit and financing, others do not. The same holds true for documentation. Each lender has different application processes and varying documents depending on the type of loan. In general, the following are documents you will want to consider in your proposal.

Because this is an asset-based loan, private lenders are interested in seeing the asset—your property, inventory or equipment. To this end, take pictures of both the inside and outside and pay particular attention to areas that you are rehabbing. If this is a fix and flip, construction from the ground up, or rehab, be sure to get bids from sub-contractors. These will be included in your budget. If a rehab or fix and flip property, your scope of work should entail all improvements you are making and under specific categories such as electrical, framing, and plumbing. Make it easy for the lender to see your vision through your descriptions and by making it detailed and thorough.

Needless to say, you will need your purchase contract. Some request property financial and income/expense statements. And others will ask for a credit report. Hard money lenders are very unique in their needs. In some instances, what you say is as important as what you bring. Lenders for commercial loans want to know that you’ve done your homework and know what you are talking about. Demonstrate that you know and understand the project explicitly and explain why it is a good investment. You will definitely need an exit strategy—how do you plan on funding their payment at the end of the loan period.

The Difference

At Level 4 Funding, we do our best to make the process of obtaining a residential or commercial loan as easy and painless for you as possible. As mortgage brokers, we are experts in our field who have been in the business for twenty plus years. We keep paper work to a minimum. For instance, for a construction loan all that is required is your budget, plans and permits.

Level 4 Funding specializes in a fast and easy approval process with flexible terms.

We understand that commercial loans are often needed sooner than the month long process traditional loans can take before funding. Our application process is fast with a usual preapproval time in 24 hours and funding that can take as little as two days. Call us with the project you have in mind and we will let you know what specific documents we require. If this is your first go-around, don’t be shy about asking any questions. We all started somewhere.

Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC Private Hard Money Lender
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis@level4funding.com 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.