good hard money lender is the best one. This is especially true if you want to finance a short-term investment real estate, which is more towards individuals who flip houses. With so many hard money lenders present on the credit market, it is really difficult to choose the right one. Here are some tips that can help you make the right decision.
- To start with, hard money is a term used to describe a loan made on a certain property that was not issued by a bank or some other usual finance channel. Hard money lenders are represented by a small group of lenders or even by private individuals. What is interesting is that a big percentage of them have made money from real estate deals. So, in this way, they continue to work on this market.
- Hard money lenders are good for short term investments. They usually need to be returned in one year or less and sometimes even within few days. The interest rates are different, but they are usually between 12% and 17% (annual interest) and the rates depend on the type of deal that is made. Our interest rates for Houston hard money loans are between 11% and 14%.
- People who look for hard money lender usually believe that the investment is profitable and they don’t have time or good credit score to use traditional banks or finance channels. There are situations in which people must act fast and they can’t wait for a week or two because the deal could be gone by the time they expect to get the money. This is why they would choose this option.
- One of the ways to find a good hard money lender is to do the research. Have they been in business more than 10 years? Do they offer traditional lending options also? Do they have a physical office you can actually visit? These types of questions allow you to build the confidence needed to consider that company as your lender. Learn about us.
- Another good way to find a reliable hard money lender is to network with some of the property investors you know. If they are experienced they probably know few hard money lenders. It is not unusual for investors that have money to use their services because there are cases when they can’t finance several projects and they don’t want to miss the chance.