Monthly Archives: January 2014

Are you familiar with Hard Money Construction loan?

Hard money loan are loan that is given by private investors. Hard money loan providers can be from anywhere but the lenders or borrower to work within their own state, i.e. if you are looking for a loan in Los Angeles then you need to find an investor in Los Angeles.

Construction loan: Under construction loan, the hard money lender offers the the borrower the money in stages. For Eg: If you have a land in Los Angeles and want to build a house on it, then you need to get a approval from the city of Los Angeles to your construction plans. Once your plans are approved you can now contact the hard money lender, providing him the complete information about the construction including construction budget. After the lender agrees to loan you, the hard money lender will loan you the money is by stages. The stages are:

• Contractor finishes the foundation, the contractor will get paid after inspection.
• when your electrician finishes the electricity in the house, then the electrician will get paid after inspection.

You understand the concept? All contractors will get paid by the hard money lender by the completion of the construction. The reason behind the hard money lender do that, because he want’s to have control of the money. Private investors know the risks they’re taking but they’re still willing to take these risks only if they have 100 percent control of the money.

Finding a Genuine Hard Money Lenders?

Are you not able to find a genuine Hard Money Lender in your town, in-spite of your hard efforts? If you have answered “yes” to above questions, then you are on the right place. We will help you finding the answers to your questions. So what is basically a “real” hard money lender company? There are some basic differences between the real hard money lender over the false company. Apart from this there are some major reasons of choosing a true hard money lender over a false one.

1 – A true/Genuine hard money lender is never interested in your credit history. A real lender will never put a condition that if you don’t have a good credit history, you won’t get financing. There are many hard money lending companies, which will say that they don’t care about your credit but at the end of the day, they’ll say that their minimum credit score requirement is 600. The main reason behind this is that, these lenders are packaging their loans for Wall Street or banks, so ultimately they’ll have to conform to all the legal requirements set up by these traditional lenders, which can’t be afforded by a person who has a bad credit history.

2 – On the other hand, a real lender ONLY cares about your collateral you are willing to invest in. They will get your property evaluated by professional independent evaluators, who will look at your property without any preconceive notions. They will give a purchase price, repair cost and estimated after repair value (ARV) of the property to the lender and if they find it good enough, they will fund you there and then.

Whereas, the imposters will put your credit score, job history, salary and other finances at the top of their loan requirements list before offering you a loan, which is exactly same as conventional lenders work.

This shows that there is a major difference between a real lender and an imposter.