Hard money loans may be the best loan option for borrowers who don’t have income documentation, have credit issues or have problems with their properties and can’t qualify for the traditional loans. Private financial lenders offer hard money loans to borrowers and not banks. Therefore, these loans are more flexible and adaptable than the conventional bank loans.
However, most people who want to get these loans don’t have the right information. That said, they don’t maximize the benefits. Monroe Funding Corporation, one of the top hard money loan lenders in Florida, shares some facts about this type of financing.
One of the things that people don’t know about hard money loans is loan points. They are also referred to as the origination fee, which is the percentage of the total loan amount. Loan points are used to pay loan officers.
Many borrowers are not enlightened about interest rates. The interest rates for hard money loans range from 8% to 12%. Don’t be discouraged by the higher interest rates because hard money loans provide the immediate cash you need that you could otherwise not get from the bank. Besides, hard money loans have manageable monthly payments.
Simple loan applications
The application process for hard money loans is more straightforward than conventional loans, which means the application process is easier. After all, the application process requires less documentation and lower credit scores. Additionally, hard money lenders may approve your loan even if your property has issues.
Hard money loans are short-term ones. They allow borrowers to access emergency cash until they secure permanent financing. Hard money loans come in handy when borrowers have pressing issues that can’t wait for weeks to get cash.
Hard money lenders are more flexible than conventional lenders. The borrower’s chances of getting approved are high. Besides, you can apply for the loan using the property appraisal and title report.