You have been looking for the perfect property to invest in, but the structure is in bad condition. Due to the condition, the bank won’t approve a mortgage to purchase. However, a hard money lender is willing to give you a loan to purchase the property, plus you are able to have cash-in-hand in as little as seven days!
How is this possible? Read on to learn why this loan option is imperative for real estate lenders! Plus if you’re looking to purchase real estate in California, we’ll show you a hard money lenders California we recommend!
What are Hard Money Loans?
Hard money loans are loans that are borrowed from a lender (an investor or investor group). The terms of the loan will depend on the contract between you and the specific lender.
The borrower receives money in exchange for paying monthly interest on the loan until it is fully paid back to the lender. In addition, the lender will typically charge the borrower a one-time fee to process the loan. The one-time fee is charged up-front.
Hard many loans are backed by physical assets—generally the property being purchased. In comparison, traditional bank loans are based on an individual’s credit score.
Who Needs a Hard Money Loan?
It is common for people to use hard money loans in real estate investing since traditional lenders will not lend on risky investments. Banks and other financial institutions are more interested in lending on stable investments where it is more likely they will get their money back. Thus, if someone is interested in purchasing a distressed property to rehab or flip, there are few lenders available to them. Enter hard money lenders.
People who need hard money loans are:
- A real estate investor who wants to purchase an old property to fix and rehab.
- A real estate investor who wants to flip the property.
- A real estate investor who is purchasing an income property may use a hard money loan until they can secure a traditional mortgage.
- A buyer who is unable to get a mortgage from a bank because of a low credit score.
- A homeowner who is facing foreclosure.
Benefits of Hard Money Loans
The main benefits for borrowing from hard money lenders:
- Fast Process: The loan may be approved within a few days.
- Less Hoop Jumping: There are fewer hoops to jump through to secure the loan—hard money lenders do not care about your credit score or financial debt.
- Borrow More: A hard money lender may be willing to lend 100 percent of the purchase price.
- Build a Relationship: It is easier to establish a relationship with a single investor or small group of investors. As a relationship is established, the lender may give you better terms on the loan.
- Good for Starting Out: These loans allow you to purchase property with very little money of your own.
If you are looking for a quality lender in California and don’t want to scan through endless lists of lenders when you Google, “hard money lenders Califorina”, here is our recommendation. Equity Wave Lending, a direct money lender based in Irvine California is known for same day approvals, not checking credit scores or income, and funding within 7 to 10 days after approval. Contact them today and start your Business Purpose Quick Loan Inquiry Form today!