If you want to purchase a home or investment property, but inadequate home equity or credit scores hinder your efforts, hard money may be an excellent financing option. Hard money is typically arranged by brokers who work with private investors or lending networks to provide borrowers with quick access to substantial funds. For more information, check out this guide on Hard Money Lenders in Atlanta through this link https://dfw-hardmoney.com/hard-money-lenders-atlanta-georgia-loan-lender-guide/. You will learn about Hard Money Investment strategies, what the loan process looks like, and much more. All the same, if you're looking for a hard money lender, here are five reasons to consider one:
No Credit Checks
Hard money lenders don't rely on traditional credit scores and credit histories to determine whether a borrower is eligible for financing. Instead, hard money lenders base their decisions on the property's value, the value of its underlying collateral, and the borrower's ability to repay the loan. This makes it possible for borrowers who ordinarily wouldn't qualify for loans because of their lack of credit history or poor credit scores to get approved for a loan and start their real estate purchases sooner than they might have otherwise.
Hard money lenders are known for offering very flexible loan structures that can include balloon, interest-only, or amortized payments. These loans are particularly beneficial to investors who may need to realize profits quickly, but they do carry significantly higher interest rates than traditional home loans. So, if your needs allow for it, you could potentially take advantage of these flexible loan structures to lower your debt-to-equity ratio and optimize the value of your real estate.
Faster Approval Process
Hard money lenders provide speedy loan approval times because they don't require the extensive documentation, appraisals, or credit reports that traditional banks may need before approving a home loan. Hard money loans are typically closed in just about anywhere from 24 hours to three days, which can save you considerable time and effort if you're in a hurry to get your deal done. However, keep in mind that this speed may come at the cost of additional interest on the loan.
Build Up Relationship
Because hard money lenders are private lending networks, they have more direct contact with borrowers than banks or traditional lenders. This allows for a more personal level of service, which can be beneficial to real estate investors looking for a cash flow solution rather than just a traditional mortgage. When you're working with a private hard money lender, you'll be able to build an effective rapport between yourself and the company by engaging in healthy dialogue about how your real estate investment will work. You'll also gain access to additional funding sources that you may not be able to secure through traditional banking institutions.
Improve Buy And Sell Prices
With a hard money loan, you can leverage the value of your property to secure a higher level of financing than a typical bank will allow. Many times, a hard money lender can work with you to buy or sell your house for more than you otherwise might have been able to realize on your own. You'll be able to access that additional equity from the proceeds from the sale of your house and use it as part of the closing costs associated with selling your home.
Hard money loans have been around for decades and have proven to be an excellent financing tool for real estate investors and home buyers. If you're looking for a way to get into a home or investment property that you would typically not be able to because of your lack of traditional credit, a hard money lender might be an excellent option.