When defining a hard money loan, you will find that it is financing that is given to you by non-institutional lenders. Even when there are many hard money lenders, it is important for you to ensure that you are working with the right lenders. If you are looking to acquire the funds without much hassle and complications, be sure to first ascertain the legality of the lender that you are about to get involved with. Here are some of the unparalleled effects of getting your money from a hard money lender.
With the hard money lenders, you never have to wait forever for your application to be approved; there is the aspect of speed and immediacy. If you were to compare two cases, one that took a loan from the bank and one that went to the hard money lender, you will find that the latter gets their money within two days while the former cold even take forty five days. When it comes to the interest rates and the time for approval, you will find that it varies from one hard money lender to another. In efforts to avoid unnecessary charges, it is critical for you to ensure that you check the agreement clauses, read them and understand before making any commitments.
Since you are borrower in this question, you are ultimately able to negotiate on the terms of payment; the schedule works for you; you choose the repayment plan that is most workable for you. When looking at the other institutions such as banks, you find that you do not have this freedom; you work with that they have. With the agreement being discussed between the lender and the borrower, you find that it is fair. Additionally, you will notice that there are no prepayment penalties for you; you can pay even before the maturation date.
The other advantage that you have with hard money loans is that they do not have all those requirements for your approval. The fact that the application has minimal requirements means that they will also need minimal paperwork which is all to your favor. When looking at the eligibility, you will notice that most of the lenders will first look at the asset that you are offering as security before giving you the loan. With all the factors syncing, then you get to see that it becomes easy and very convenient for you to get the money that you needed; fast.
Even when it is not a critical factor, you will notice that some of the money lenders will want to go through your credit history. It is only when you talk to the lender that you will gain insight on how they operate.