Commercial hard money loans can lend a helping hand when a borrower needs a quick loan. It is still always helpful to do plenty of research and know the best ways to approach this process from the beginning of the application to closing.
First, start looking for a reputable and dependable lender that specializes in commercial hard money loans. This is when referrals really come in handy, so don’t be afraid ask others that you trust who they may recommend. Next, structure and design a plan. You want to be prepared when you are going to meet with your lender. Make sure that when you meet with your lender, present a thorough plan that includes long-term goals that you have in mind for business. Also, always include specifics like deadlines and other important dates.
The plans that you present to your lender should not only include deadlines and other important dates, but also the address of the property, the reason for the loan (is it a new loan or are you refinancing an existing loan), the property purchase price and the budget you have set. You can find a number of ways to present this information, just be prepared and have all the information present that is needed for the lender to make their decision. The more prepared you come and the more information that you present, the more likely that you will see approval.
Commercial hard money loans require certain documentations for a better chance of approval. A note and deed of trust is almost always required documents. Other documents your lender might request to review include financial statements, tax reports and proof income. Also, a personal guarantee for the borrower could be very beneficial.
Using lenders for commercial hard money loans are there when you need them but at a hefty cost
The thing to always remember when it comes to commercial hard money loans is that they will come with much higher interest rates and other fees compared to conventional loans. Because the risk is much higher with these loans, rates usually range between 10 percent to 15 percent on average. This may also include prepayment penalties. Of course, extensions could be possible, but you need to negotiate all of the terms and have an open line of communication with the lender at all times. This is why finding the right one you can trust and that is dependable is so important.
Know the eligibility time of your commercial hard money loans
Most of these loans have a timeline of about 12 months, but sometimes they can even be shorter for around 6 months. The shorter-term loans usually occur when dealing with single residential properties. Some loan terms can be longer, ranging anywhere between 2 to 5 years when it comes to commercial renovations.
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.
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