There are times when it is appropriate to apply for Hard Money Loans in California rather than try to gain approval through traditional channels.
Hard Money Loans California–At one point in time, if you wanted to open a business, build an addition onto your house or business, or make some much-needed repairs, you had to apply for a loan through your local bank. If they didn’t approve you, you were pretty much out of luck—but not anymore.
Now borrowers have access to money through private entities such as hard money lenders. However, it is important to note that there is a time and place to apply for Hard Money Loans in California or anywhere else.
So—went would that be?
When A Hard Money Loan Is Appropriate
If you have good credit, no strikes against you, and plenty of time before you need the money, you may want to go ahead and apply for a traditional loan. But there are plenty of factors that point towards applying for Hard Money Loans in California instead:
1. Less than perfect credit: traditional lenders are going to want to see an excellent credit rating on your application. Hard money lenders are more concerned about the value of your property.
2. If you have had tax liens, court judgments, and/or unpaid items on our record.
3. If you need money sooner rather than later for any of a wide variety of reasons
4. For house flipping (see No. 3)
5. You need to close on a deal quickly
6. The borrower needs a loan due to tax returns (or lack thereof)
7. To avoid foreclosure (again, see No. 3)
8. If you are not a citizen; foreign nationals
9. Your bank wants to do a complicated loan with multiple pieces of collateral
10. You really don’t want to pay a ton of fees.
Essentially, when it comes to a hard money loan, most people that apply for them will not have the credit needed to get approved for a traditional loan and/or will need the money sooner rather than later. Thanks to the easier application process, faster approval is something borrowers can count on.
Other reasons would point a borrower towards hard money over a traditional lender, but the reasons mentioned above are some of the more common ones.
What To Remember About Hard Money Loans in California
While it will be nice to get your money quicker and put it to use, there are things a borrower needs to remember. The life of the loan is going to be a lot shorter meaning you will have to make fewer, but larger payments to pay it off. Also, to compensate themselves for the increased risk, hard money lenders charge a higher interest rate.
So if you can, pay your hard money loan off as soon as you can to reduce the cost to you.
Dennis Dahlberg Broker/RI/CEO/MLO
Level 4 Funding LLC Private Hard Money Lender
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701
About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.