There are several reason to contemplate getting a hard money investment loan instead of a conventional loan.
There are pros and cons when it comes to absolutely every decision in the world you will make—and when it comes to your money it is crucial to reflect on both the pros and cons. Investment loans are an amount of money lent to finance a particular project. Investors have choices when it comes to the type of lender they want to work with—generally, they will work with either a traditional lender or a hard money lender.
Hard money investment loans have a lot of benefits for investors. Convenience for one—because of the new regulations on mortgage lending implemented as part of the Dodd-Frank Act, applying for a conventional mortgage is terribly time consuming. On average it takes about 45 days to close on a loan with a conventional mortgage. And that is “average.” It can take up to 90 days if there are any type of hang ups—which there almost always will be. This excessive wait time puts investors at risk of losing their deals. A hard money investment loan can typically be funded within two weeks.
Because hard money investment loans are available through private lenders there is more wiggle room when it comes to loan terms. Hard money lenders don’t use a traditional underwriting process which allows more flexibility. Investors may even be able to tailor the repayment schedule to their needs—and may be able to get certain fees waived depending on the lender.
In a hard money investment loan the property typically serves as the collateral. That can be a pro or a con depending on the unique situation of the investor. However, because hard money lenders are able to be more flexible they may allow investors to secure their loan using their own personal assets such as their personal residence. Hard one lenders look at each project individually and work with investors to make the repayment and terms work for both of them.
It is always important to pay attention to the rates and terms in any financial dealings. With a hard money lender, investors have an opportunity to mold their loan to their goals, which can be helpful.
Hard money investment loans are a great fit for investors who need funding quickly with flexible terms and repayment schedules.
Conventional loans come with a whole lot of red tape that investors generally don’t have time to deal with. The bottom line— investors can know their lender, work with their lender and form a real relationship with their lender and that can be priceless.
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: 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.
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