(If you are looking for alternative finance options, then you are certainly going to want to understand what hard money lenders are and what they have to offer. It could be the answer you are searching for.)
To understand who Texas Hard Money Lenders are, you first need to understand what hard money is. Hard money has nothing to do with how difficult it was to earn. Hard money is a type of short-term loan that is secured by the property that is being purchased. Also called asset-based lending, these loans offer many benefits as they do not rely so heavily on an individual’s credit score. And while many borrowers look at Arizona Hard Money Loans as a less than legitimate loan or something of a questionable nature or legality, these loans are perfectly legal.
Texas Hard Money Lenders are private individuals or private groups who offer these loans to borrowers. The lenders are in business to make money, and they choose to do it by offering loans based on the value of the collateral rather than the borrower's creditworthiness. And because they are offering a service that is less challenging to qualify for, these lenders know that they can charge a higher interest rate than a traditional bank or mortgage company.
When you speak of hard money and soft money, it can be a little bit confusing. But hard money is used for traditional purchases like a car which gives you many years to pay the loan back. Hard money is a short-term loan, meaning that you normally must pay the money back in about one year. So this would not be a favorable term for a car loan. But it does work very well for a fix and flip investment property purchase, or even a renovation to your personal home before refinancing your house and paying off the private loan.
The Most Common Uses For Hard Money
As we previously mentioned, the key to a hard money loan is the short term of the loan. So these loans are great for investments or projects which will be completed in a year or less. One of the more popular uses in the past few years is for house flipping. These loans fund quickly and allow investors to pay for the property and the renovation from one loan. Property development is another common use for Arizona Hard Money Loans as the projects normally fall within the one-year time frame. And personal loans that are needed to make home repairs or to consolidate bills could fall into the realm of a hard money loan.
Working With Hard Money Lenders
What is important to understand is that a hard money lender is just like any other business person. He or she is interested in loaning money to earn a profit on the interest. In addition, the lender is likely to work with the borrower on terms and conditions in order to close the deal. If you are new to hard money, it is best to simply be honest with the lender ask any questions that you might have about the process so that you are both comfortable with the agreement and the outcome of the loan.
Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC
Hard Money Lender
Hard Money Loans
Hard Money Loan
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis@level4funding.com
Dennis Dahlberg Broker/RI/CEO
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave | Austin | Texas | 78701
About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 43 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.
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