Real estate investment is a lucrative profession for building wealth, which allows you to invest passively. Some investors prefer to own the property directly that belongs to them. In this case, your partner for private real estate & hard money Lending plays an important role. They provide short term loan, which is secured by real estate.
This type of loan is generally for one year, but you can extend it for 2-5 years, depending on your project investment. You need to pay the monthly interest and principal amount with a balloon payment when the term ends. The amount that your lender will lend also depends on the value of the project property prices. It can be a property that you already have, and you want to start your housing project or else, it is a property that you will get.
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Remember, a hard money lender's main concern is property values, rather than the credit as a borrower. The main benefit for borrowers is that they can still get loans even if they can not get conventional financing for a short sale.
Even if you have sufficient equity in the property and it is currently being used as collateral, you can still get a hard money loan. When the banks turned their back on you, hard money lenders will always be with you.
Hard money loan is suitable for scenarios such as:
– construction loans
– Fix and Flips
– In the case of real estate investors need to act quickly on the project
– A buyer having credit problems