Hard money loans are an excellent option for those who don’t have many good credit options. They allow the borrower to borrow funds without worrying about paying an arm and a leg in interest rates. However, most people find out that hard money can be just as expensive as any other type of loan with high-interest rates and origination fees. Before getting one, you should know more about the FAQs of hard money lending. Below are the benefits of taking out a hard money loan for your home.
Easily Approved
One of the great benefits of a hard money loan is that you are much more likely to be approved for the loan. This is because the lender is taking on less risk by lending to someone who already has a property secured as collateral.
Many people like it because it is a fast way to get the money they need in a hurry for their home. It is known that the approval process for a hard money loan is much faster than that of a traditional bank or lending institution.
Finances Home Project
Hard money loans are a great option for those who don’t have many good credit options. They allow the borrower to borrow funds without worrying about paying an arm and a leg in interest rates. However, most people find out that hard money can be just as expensive as any other type of loan with high-interest rates and origination fees.
No Pre-Payment Penalty
One of the most common ways to get out of a loan is by paying it off early. This is not an option with hard money loans because they do not have pre-payment penalties which mean that you can pay back your loan whenever you want, without any additional fees. The lender cannot penalize or charge interest on top of what has already been agreed to. This is a huge benefit for those who know they will pay off the loan quickly and without any penalties. It also makes it easy to budget your money because you know exactly how much you need to pay each month.
Hard money loans are a great option for those looking to get out of the costly and lengthy refinancing process with a bank. In some cases, hard money lenders can even provide their clients with better rates than what they’d find in traditional financing. This is due partly because banks typically require you to have less equity when applying for a mortgage refinance, whereas hard-money lenders may not set such requirements. If this sounds like it could be an opportunity that would work well for your situation, and you want someone else to take care of all the paperwork? We’re here to help.