
When you think about hard money loans, what comes to mind? A lot of people picture a borrower who has a low credit score or other obstacles to getting a regular loan turning to hard money loans with higher interest rates.
In truth, interest rates on hard money loans are not always high, especially if you have a good credit score. Why would people with good credit scores use them? Because hard money loans offer a number of other benefits. Let’s take a look at some of those advantages so you can figure out if a hard money loan may be right for you.
- Get funding fast. One of the most common reasons to use a hard money loan to buy a property is the need to close on it fast. This happens a lot among real estate investors, especially those who fix and flip. The hard money loan process is quicker than the process for most other loan types.
- A simpler mortgage process. Along with being faster, the hard money loan process is more streamlined. This simplicity makes it easy for the borrower, minimizing the amount of documentation they need to provide. This leaves the buyer free to focus on their search for the ideal property, and removes stress from the lending process.
- Buy a wide range of properties. Hard money loans have more flexible requirements when it comes to the type of property you are purchasing. You can buy a property in good condition with most types of home loans, including hard money loans. But if you have your eyes on a distressed property, perhaps for a fix and flip, then you may not be able to use other loan types to buy it. Thankfully, you can buy these properties using hard money loans, giving you the chance to repair and improve them, reselling them for a profit.
- Hard money loans are regulated and safe. One of the most widespread misconceptions about hard money loans is the belief that they are inherently risky and unsafe. There is always a degree of risk to borrowing a large amount of money, but hard money loans are not that much riskier than other mortgages. As for hard money lenders, they are regulated, just like lenders for other types of loans. So, the process is the same: find a lender that is licensed and regulated, and you will be protected by those regulations when you apply for a hard money loan. In fact, a lot of the same companies that offer other types of mortgages also offer hard money loans.
Apply for a Hard Money Loan in Florida
The advantages of hard money loans go far beyond what many people realize, and can be a fit for a range of real estate investing scenarios. PLC is based in Cooper City, and can connect you with a hard money loan anywhere in Florida. To get started, please give us a call at 954-840-8811 to schedule your consultation.