A hard money commercial loan can provide you with the capital necessary to complete your current project or to seize the opportunity to start a new one. How? Well, it is quite simple really. By using the commercial property you currently have as collateral, a hard money commercial lender can provide you with the money you need to continue production. However, there is a small catch. The interest rates on these hard money loans are often higher because typically those who seek hard money loans do not qualify for traditional loans. That is, those who seek hard money loans are considered a higher risk for default. However, at the end of the day, you can have the necessary capital to continue with your business.
How this benefits you is plain. Instead of standing idle while profit and possibility pass you by, you could be back on the offensive. You could take charge and make plans.
Pros And Cons Of Hard Money Loans
Most people who approach a hard money commercial lender do so as a last resort, often when their credit or financial situation disqualifies them from regular financing. A hard money loan can be a good option if you have bad credit and you need a short-term loan to cover current expenses. It can also be a solution if you need money for a quick investment or to tide you over while you get back on your feet.
A typical hard money commercial lender will advance between 65% and 70% of the loan value for added security. This results in a much lower loan-to-value ratio than conventional loans. Interest rates are also much higher, even higher than those subprime mortgages, which can make default a real risk for the borrower. Just like in a regular mortgage, a hard money lender can foreclose on a home if the borrower is unable to pay.
What is Criteria of Hard Money Commercial Lenders
The lenders look for you credit scores, total value of property and other essentials on the basis of which they can lend you the commercial hard money loans. If you are looking for such kind of loan there is no need to worry. There are lots of trusted companies that will lend you money without taking much of your time.
Lender company teams will help you immensely in guiding you through all the procedures and formalities in getting the hard money loans.
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Do Hard Money Lenders check credit?