Commercial hard money lenders offer hard money loans to commercial property investors. These lenders are still lending money to borrowers even after the recession which hit most economic sectors across the world. Today, there are many hard money lenders with loans that you should consider when looking for a hard money lender to get your commercial establishment or investment loan from.
Short term loan
Typically, a commercial hard money loan refers to a short term loan. It commonly has a one year term although you can negotiate for the extension of the term. Some hard money lenders can offer commercial loans of up to three years. This is due to the fact that hard money lenders are also trying to lend more money so that they can realize more profits.
Consider prepayment penalties and exit fees
This is very important factor to consider when getting a loan from commercial hard money loan, An exit fee is usually a major fee that most hard money lenders will charge you when you pay off the loan before the term end. Some lenders will charge you this fee even if you pay off the loan early, late or on time. Additionally, be careful about the late fees that some lenders charge for balloon payment. With more than 70 percent of hard money loans being paid off late, lenders do everything possible to track the charges for balloon payments which are made late. This can be even ten points with some commercial hard money lenders. It is important that you consider such fees and payments when getting your commercial hard money loan so that you can apply for a loan that you can pay off comfortably.
Speed is very important in investment. You have to get financing quickly so that you can buy a commercial property before another investor buys it. Many commercial lenders of hard money win businesses on the basis of their speed. A hard money loan deal can be closed with ten days or less. This is what makes hard money loans a preference for most property investors. Therefore, look for a lender that will take the shortest time possible to process your commercial hard money loan so that you can purchase the commercial property that you are eyeing before another investor takes it.
Value added deals
There are lenders of commercial hard money who specialize in the value added deals. These are deals in which developers purchase existing properties after which they improve them using the loans that they get from hard money lenders. For instance, a developer can purchase a raw land then up-zone the property. A developer can also purchase an empty retail center after which they upgrade it before installing new improvements for tenants. After improving the property, a developer can sell it or even refinance it in order to get out the profit.
Generally, there are many things that you need to consider when dealing with a commercial lender of hard money. follow us on twitter and take your time to consider all the dynamics of commercial hard money lenders and their loans before you proceed to sign for your commercial hard money loan.
Finding the best hard money lenders can be challenging due to the high number of hard money lenders that are available today. Each hard money lender that you come across promises you the best terms and quick loan approval. This can make finding the best lender to get your hard money loan from a headache. However, when you have tips to guide you, you can relax and start the search for a hard money lender comfortably.
Consider the hard money loan process
A hard money loan should give you a quick capital for purchasing an investment property. Since some investors seek financing after winning a property auction, then need financing within 72 hours. It is therefore, important that you consider the hard money loan process of the lender that you are considering when looking for a hard money loan. All you need is to provide collateral for the loan and fill the necessary documents to get your hard money loan on time.
You do not want to be frustrated when you cannot reach the hard money lender after signing for a hard money loan. It is therefore important that you choose a reputable hard money lender. Conduct a quick online search to find out what other borrowers say about the hard money lender that you are thinking of. If you have another loan that you are paying, find a hard money lender who will give you the best deal on your hard money loan. There are many reliable hard money lenders that you can contact and get the best deal from. Just conduct a simple online search to find the best hard money lenders.
Stress-free application and approval process
The main reason why you might prefer hard money loans to conventional bank loans is the fast application and approval process. This is because having your loan approved by a conventional bank can be a headache. You also have to wait for days to have your loan application approved. Hard Money Lenders Houston TX can understand and make your application and approval process easier and efficient. Your time is very important and the lender should therefore process and issue loans quickly.
The houston lending offer friendly terms to hard money borrowers. Before you sign up for a hard money loan, read through the terms of the loan and understand them properly. Agree to a written contract only and when certain that you understand every term in it.
A good hard money lender will offer reasonable interest rates on hard money loans. Usually, interest rates for hard money loans range between 10 and 18 percent per year. The interest rates for hard money loans are determined by lenders after evaluating the collateral. Nevertheless, the best lenders will always charge borrowers reasonable interest rates.
Generally, a hard money lender should aim at making the process of getting a hard money loan simple, efficient and transparent. The best hard money lenders should also charge reasonable interest rates and fees for their loans.
Texas hard money lenders offer asset-based loans with high interest rates. These loans are usually short term loans that give borrowers financing when they cannot qualify for financing from traditional banks or lenders. This loan is considered as a bridge loan by many borrowers. This is because it acts as a quick-fix loan which fills their financial gap. The loans from hard money lenders are seen as a step below the subprime offering. They are also the last way of getting financing that one can get. Many people including real estate developers in Texas have used these loans in purchasing, developing and remodeling properties.
Types of hard money lenders
There are two major types of hard money lenders in Texas. Their categorization is based on the type of hard money loans that they offer. However, it is important to note that these lenders are exceptionally similar though there are different benefits of each to the borrowers. These lenders are private money lenders and typical hard money lenders. A private hard money lender is a single individual who offer loans to borrowers. This implies that the lender and the borrower know each other. Typical hard money lenders are usually a group of individuals. Nevertheless, accessing loans from both types of hard money lenders is easy though interest rates are high. Their loans are also flexible than those of traditional banks especially when a private money lender is used.
In the past, people have sought funding from Texas hard money lenders as a last resort due to their negative connotation. However, many lenders have established excellent reputation by offering better services and transparent financing. People with bad credit who are turned away by conventional lenders turn to hard money lenders and they welcome them. Others are investors who need quick cash and they do not want to spend time quieting in banks or waiting for their loan applications to be approved. All these get financing from hard money lenders in Texas. These features of hard money loans have enhanced the reputation of hard money lenders and many people now prefer their services in Texas.
Deal with a local hard money lender
When looking for a hard money loan, it is advisable that you deal with a hard money lender in Texas. This will make meeting the lender easier. Some lenders also want to see the property that the borrower wants to invest the loan in. This implies that taking a local hard money lender to the property that you want to invest in will be easier. Although there are nationwide lenders, their terms are usually more conservative than those of local Texas lenders. Therefore, consider dealing with a local hard money lender to get better terms for your hard money loan.
Generally, there are many hard money lenders in Texas but they all deal with the same thing which is to offer short term financing to borrowers. However, when in need of a loan from Texas hard money lenders, take time and watch our youtube video and you can compare the terms of each lender so that you can get a loan with the best terms possible.