Hard Money Loans – The Advantages
Sunday, August 13, 2006
It’s true that hard money loans often come with much higher interest rates than traditional loans. So why on earth would anyone want one? You’re probably thinking that if you can get a bank loan in the traditional way for a lower rate, then there must be other advantages that accompany a hard money loan which make getting one appealing. And you’d be right. Read on for some reasons why a hard money loan may be just what the doctor ordered.
The most common reason to go after a hard money loan is to get the money faster. With a bank loan, you are usually looking at a 45-day minimum to get your money, and longer in most cases – up to six months isn’t uncommon. Private money, which is used in hard money loans, can usually be in the hands of the individual that applies for it in as little as 24 hours, which means you can start making use of it almost immediately. In the case of the leading private hard money lenders, Kennedy Funding prominent among them, you can have your money in as little as five days, with a commitment in two days or less. Lenders on the level of Kennedy Funding pride themselves on speed, and upon an ability to structure loans according to the borrower’s special circumstances. In other words, top hard money organizations are much more nimble and versatile than conventional lending institutions.
Another reason someone may investigate hard money loans concerns the current state of their property. If a property needs fixing up or does not produce cash flow, you usually can’t get a bank loan. But if you’re after a hard money loan, a private lender, say a Kennedy Funding, may be able to get you the money you need to fix up the property or get it to a state of making money. It’s good for both you and the lender, although at a higher interest rate price tag. The bottom line is, you’ll need to decide if the hard money loan is what you really need and if it will truly benefit you in the long run.
Lastly, if you’re looking to buy commercial property with no tenants, you’ll find that banks will typically not want anything to do with it. A hard money loan can help act as a financing bridge. The hard money can buy you time to get tenants and have them on-site for a year or more. At the end of that time, you can refinance at a lower rate with a bank and pay off the hard money loan in the process. Of course, you’ll still need to make the final determination whether or not a hard money loan is right for you. Many borrowers decide that the speed, which Kennedy Funding and other leading lenders provide, more than makes up for the increased interest rates that they’re required to pay.
The most common reason to go after a hard money loan is to get the money faster. With a bank loan, you are usually looking at a 45-day minimum to get your money, and longer in most cases – up to six months isn’t uncommon. Private money, which is used in hard money loans, can usually be in the hands of the individual that applies for it in as little as 24 hours, which means you can start making use of it almost immediately. In the case of the leading private hard money lenders, Kennedy Funding prominent among them, you can have your money in as little as five days, with a commitment in two days or less. Lenders on the level of Kennedy Funding pride themselves on speed, and upon an ability to structure loans according to the borrower’s special circumstances. In other words, top hard money organizations are much more nimble and versatile than conventional lending institutions.
Another reason someone may investigate hard money loans concerns the current state of their property. If a property needs fixing up or does not produce cash flow, you usually can’t get a bank loan. But if you’re after a hard money loan, a private lender, say a Kennedy Funding, may be able to get you the money you need to fix up the property or get it to a state of making money. It’s good for both you and the lender, although at a higher interest rate price tag. The bottom line is, you’ll need to decide if the hard money loan is what you really need and if it will truly benefit you in the long run.
Lastly, if you’re looking to buy commercial property with no tenants, you’ll find that banks will typically not want anything to do with it. A hard money loan can help act as a financing bridge. The hard money can buy you time to get tenants and have them on-site for a year or more. At the end of that time, you can refinance at a lower rate with a bank and pay off the hard money loan in the process. Of course, you’ll still need to make the final determination whether or not a hard money loan is right for you. Many borrowers decide that the speed, which Kennedy Funding and other leading lenders provide, more than makes up for the increased interest rates that they’re required to pay.
0 Comments:
Post a Comment
<< Home