In situations where you need to act fast, borrowing from a private investor may be a great option that speeds the lending process along as well as amplifies your ability to obtain property. Read more to find out if hard money from private lenders offer benefits that public lenders can’t.
Arizona Hard Money Loans are not offered by traditional lenders like banks, but by private companies and investors. Arizona Hard Money Lenders have higher interest rates and a shorter payback period. Because of this, they are often times used in competitive bidding for property or in the event of preventing a foreclosure.
While receiving a Arizona hard money loan often results in a speedy process, there are a few drawbacks to consider. First, it is important to consider that the payback period is short, usually only 12 months. Sometimes, though, it can be extended between two and five years. Furthermore, it is also important to note that these kinds of loans have a higher interest rate. Interest ranges from 10 and 15 percent, which is more than what a traditional lender such as a bank would charge.
However, unlike a bank, Arizona Hard Money Lenders impose less strict limitations. For example, banks will be highly concerned with your credit score and income history. Unlike a bank, Arizona Hard Money Lenders are concerned with the collateral and value of your property. Even if you have an imperfect credit score, Arizona Hard Money Lenders will be likely to work with you because they assess the value of the property with an LTV (a loan to value ratio). Some ratios can lead to investments as high as 75 percent of the property’s worth. What may be referred to as the “risk” they take with this is reflected in their interest rates and fees. While the expense may be a drawback, sometimes they are the only option for people who can’t receive funding elsewhere.
Meeting with Arizona Hard Money Lenders
Arizona Hard Money Lenders can be found locally. Sometimes they can be referred to you by a mortgage broker, but lists of Arizona Hard Money Lenders are always available on the internet. When committing, it’s important to always evaluate the legitimacy of your lender. If you have any concerns or questions, a real estate attorney may be helpful in identifying any major stipulations regarding loan fees, interests or rates. Under legitimate circumstances, relationships with Arizona Hard Money Lenders are transparent, flexible and individualized.
Deciding if Hard Money is Right for You
Arizona Hard Money Loans are not for everyone, but they can definitely lend a helping hand to people in financial need, specifically those who need to act fast to obtain a property or prevent a foreclosure. Not all financial situations will lend themselves to speedy benefit of hard money, and oftentimes it is those who aren’t able to obtain financial funding from banks that benefit from it. The short-repayment period and high rates cater to a specific market, but depending on your situation, they could be the right option for you.
Level 4 Funding LLC
Hard Money Lender
Hard Money Loans
Hard Money Loan
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis Dahlberg Broker/RI/CEO
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 43 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.