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We cannot ignore the fact that these days’ borrowers are finding difficulty in getting a loan from banks. It can be due to any reason, such as either they have a poor credit rating or banks do not want to take risks or they cannot follow strict loan criteria. No matter what the reason is. But, such inability to get money is encouraging real estate investors to move towards the other option, i.e. hard money loans.

Hard Money Loans

Hard Money Loans

Let’s have a look at few benefits of getting hard money loans over other types of loans to make an easy and safe real estate investment.

Short Period of Time

If you are thinking of buying a particular property, you cannot wait to have a money for investing in buying that property. What to do if you do not have enough money? Obviously, you will go for hard money loan that can be obtained within a short period of time. Some lenders provide funds within 4-7 days. When you contact reliable hard money lender, you can get a loan within one day. Such lenders first supervise your property and approve loan as quickly as possible. Thus, you can get your needed amount without any delay.

No Credit Score or Annual Income

You are not eligible to lend money from conventional lenders until you do not have the good credit history record, annual income proof and the related documents. For a commercial loan from a conventional lender, you have to provide documents showing the steady flow of income all through the year. When you are unable to do so, your loan application may get rejected. In case of hard money loans, you are completely relaxed from such burden. No lender will ask you for your credit scores or annual income except for collateral.

Possess Few Requirements

As we have discussed above that these loans have few requirements. You just require equity in the property you want to invest in, sufficient money to pay monthly loan amount and knowledge of how to handle loan process. When you are able to fulfill all these requirements, the possibility of loan approval increases. So, being a real estate investor, you can easily apply for hard money loans.

Provide Fix and Flip Loan

If you want to invest in a property that requires renovation and want to sell it with the profit, hard money lender can help you to get the required money for investment. Banks do not provide a fix and flip loan. This short term loan allows real estate investor to purchase a property, make the required repair and sell it for a profit. In most cases, investors require only 12-month loan, which conventional lenders never provide.

No Prepayment Penalties

Conventional lenders charge prepayment penalties if a loan completely or partially repaid ahead of the due date. With hard money loans, you do not require paying any kind of penalty as these loans are designed without prepayment penalties or any additional fee.

No matter what your investment goals are. Hard money loans always act as an effective tool to accomplish those goals. Achieve success in real estate investing business with the right strategy.

 

Benefits of Hard Money Loans