Investment Information: Types of Investors Who Choose Hard Money Loans
Investors choose hard money loans now more than ever. Hard money loans are short-term loans with flexible terms and are designed to be easy and safe for real estate investors. Because of the strict regulations traditional lenders have, hard money loans are an easy route to take when it comes to real estate investing. It is much easier to get approved for a hard money loan than a traditional bank loan.
Investing in real estate is always a good idea but there are many different ways to invest. There are many real estate investors who recommend using hard money loans in your investment projects.
These loans are generally given to individuals who flip the properties in order to make a profit. Hard money loans are also available for land purchases. Because the hard money loan process is significantly shorter than that of a traditional loan, investors use hard money to begin your real estate investment quickly.
According to Connected Investors, here are the types of individuals who use hard money loans.
- New real estate investors who can’t demonstrate enough income or cash reserves for a bank to qualify them
- Investors with poor credit, undocumented income or a short work history
- Experienced investors with more than 4 mortgages in their name
- Investors buying properties that need significant repairs
- Buyers who need renovation funding, not just purchase funds
- Investors who don’t have the cash required to close with a conventional loan
- Real estate investors who are highly leveraged elsewhere
- Buyers of properties that won’t appraise as-is for an acceptable value
- Buyers dealing with distressed sales that must close in days, not weeks
- Buyers of rental properties that are under-rented, in need of repair or otherwise problematic
- Property owners with high equity who need quick access to cash for any reason
Hard money lenders are experienced and can help you with your investments and work with you to find a loan that works for you. When you are investing in real estate, you’re not just looking for financing. When it comes to traditional loans, the bank will not be involved in your investment. When it comes to hard money lenders, they are your partners in the investment. You are looking for a lender who values open, two-way communication. Communication, integrity, and timeliness is most important. Finding an alternative lender to handle these investments doesn’t have to be difficult. Find out more about HML Investments here.