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Advantages of Hard Money Loans

A hard money loan refer on the financing which is provided by a non-institutional lender. You could actually find a lot of hard money lenders who are offering fast funding through an attractive interest rate. Borrowers should consider performing through checks about the reputation of the lender and the business, but when you do your research, you will be able to find that hard money lenders can give you various advantages on funding real estate investment project.

Below are some benefits which it can actually offer:

Faster Approvals

A benefit that could be obtained from hard money loans is due to the fact that investors can actually secure pre-approvals in just one or two days when they submitted the needed documents that the lender requested. The hard money lender have a focus whether the asset comes with good market value and borrower equity for at least 20{e9f10206dfa39f8295bff5ca0cfc80f5a721a7c2277ac86611b458c47f9bf44e}. Financing also takes place for just less than a week compared with the normal loans that could take a month or more.

Have Flexible Payments

Through private lenders, you are able to have more freedom on creating customized repayment plans. By having a big financial institution, you will not have such freedom, but you will need to accept the payment terms that have been set by the bank. With a private lenders, you can actually discuss with them as well as end up with mutually agreeable repayment plans which you find suitable for you.

Prepayment Penalties are Non

When you acquire a loan coming from an established bank, you could be subjected to prepayment penalties when paying off the loan before its maturation date. Many of the fix and flip lenders does not really charge prepayment penalties, so if you will come across an extra cash and decides to pay off the loan before the due date, you are surely confident in doing it without worrying of getting penalized.

Credit History is not a Problem

When it comes to big lending institutions, credit history have a huge impact if you are going to get a loan or not. Through private lenders, there is less emphasis placed for weak credit history. This is actually because private lender base their loan approvals on the value of property, borrower equity and others more. This is as long as you are able to meet their criteria, you will have a good chance of getting funded.

Another good thing of getting loans from hard money lenders is that there are actually a lot more properties renovated in the community and property values rise and improves the neighborhoods quality of life.

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