3 Steps to Financing with Hard Money

Successful Hard Money Loans

Hard money financing may seem like a daunting task to the uninitiated.  It actually has quite a bit in common with more standard real estate deals that involve a mortgage and traditional lending institutions. Here are the three main steps to financing with hard money:

 

Hard Money Financing Step #1: Find the Right Loan

While banks and other traditional lenders will “pre-approve” you based on your credit and income, hard money lenders want to see the whole picture before committing to a real estate loan. The reason is quite simple – they do not want to depend just on your credit for a guarantee to pay.  In addition they want to personally inspect the property, and feel comfortable that you can make payments with your current income.

 

Hard Money Financing Step #2: Find the Funds

Keeping the previous point in mind, a buyer can approach an accredited investor and explain the potential loan to them on an individual level. While this approach will work if you have an established network of people interested in these types of loans, it is problematic for the new investor. An alternative is to show your loan proposal to a private money lending institution such as California Private Money Lenders. This type of company provides a platform where the loans, the borrowers, and the lenders are all vetted as reputable. In short, using a private money lender makes the entire process of hard money financing secure, affordable, and available in one place.

 

Hard Money Financing Step #3:  Close the Loan

While a “one stop shop” for finding investors is a great thing, you still have the flexibility to make your own terms and make your own deal. You will need to have your information in order – for example, a clear summary of what you need with all related details to show that you understand what you are looking for.  Then it is simply a matter of selling your vision to potential investors.

As you can see, there are several routes to finding hard money financing. If you are hesitant to ask your friends and family, and unwilling to approach more mercenary investors on your own, consider the use of a private money lending company. Not only will you be able to avail yourself to their expertise, but also to the seasoned professionals with which they surround themselves.

Contact us today at California Private Money Lenders, either by email or by phone and we will answer your questions about hard money or private money lending.

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