Large metropolitan areas are always ripe with hard money lenders, as the renewal that is inevitable in industrial or downtown districts is perpetual. Because the large banks have begun to pare back on their loaning practices, hard money loans have quickly become commonplace. The Los Angeles hard money industry, for example, is quickly growing, as the need for financing continues despite the lack of funding currently available. We will use L.A. as the backdrop for our analysis, as it represents a large market that has a wide variety of properties available for those with funding.
While the residential areas can use the hard money loans to their advantage, we will turn our attention to the commercial hard money industry, and take note of how hard money lending can greatly increase a small business’s prospects, as well as give property companies the ability to purchase, renovate, and resell residential or commercial properties.
Ease of Acquisition
One of the most alluring aspects of hard money lenders is the ease of acquisition of the loans. When an individual or firm is attempting to acquire some property for their business or parlay that property into a future profit, commercial hard money can significantly shorten the application process. Like with all business situations, time is imperative, but this convenience will cost the borrower in the form of a higher interest rate.Los Angeles hard money organizations can step in, assist the buyer, and give them the means of moving into the next phase of their business plan.
Commercial hard money can also assist in the purchasing of homes in dire need of renovation. Hard money lenders take center-stage in this scenario, because they are able to offer up the funding for such endeavors that banks simply will not. Once the buyer has the home purchased, they can begin the renovation process, bringing them closer to the profit-line. Hard money loans provide the quick purchase required and will loan higher interest-rate funding where traditional lenders refuse to.
The points above can begin to paint a picture of the Los Angeles hard money industry. Despite the economic downturn, borrowers will continue to seek money, even if the interest rates are higher. Organizations or individuals looking to “flip” homes will be well-served to find a commercial hard money lending group that they can rely on. This will significantly shorten the processing time, allowing them to act quickly, which is always an integral part of the profit-generating process.
Hard money loans continue to provide entrepreneurs with the ability to get off to a quick start. Areas of urban renewal will always have a place for the providing individuals or firms, ensuring that their presence will continue to be necessary.