Unsurprisingly, there are two sides to every story or rather, in scenario, there are advantages and disadvantage when it comes to California private hard money. Therefore, if you are new to the trust deed investing game or financing world, you may want to brush up on some of the complaints and/or disadvantages of private hard money so that you are properly prepared.

California private hard money, as briefly suggested, can be a godsend to those who need quick and red tape-free financing. But, of course, nothing good comes without a little bad. So, what are those pesky private hard money complaints already? Well, no worries let’s go over them.

One of the top complaints about California private hard money financing or loans is the interest rate. Think of it this, you have to pay to play thus if you want your financing quickly you have to pay for it. Of course, this doesn’t cause too much of a hardship if you use your hard money financing correctly. For instance, most private hard money loans are obtained for short-term financing needs. This means if you pay your loan back before your abnormally high interest rate doesn’t get too out of control then you will more than likely survive.

Another major complaint when it comes to private hard money we just touched on a bit –short-term use. Many commercial real estate and trust deed investors wish they could use private hard money for more than the standard limit of up to 5 years (3 years in some other places). But, as previously mentioned, extremely high interest rates make that a bad idea. So, why on earth would this be a complaint? Well, as you already know private hard money loans or financing are a lot easier to get than your traditional financing. Remember, red tape-free and quick approvals—who wouldn’t want that to last a little longer.

Managing Your Private Hard Money Expectations

The third common complaint is the down payment requirement. Typically, you will find a larger down payment requirement or equity of 25% or more. The reason you will you see such harsh requirements with private hard money financing is because lending will always be a business. In other words, these particular lenders are taking a chance on your business venture and if by chance things do not go as planned or you are unable to meet your loan terms then your lender needs to be financially alright. So, what does all this really mean? It means you need to manage your expectation when it comes to your lenders as well as when it comes to your future business venture.

Private Hard Money Can Still Make Dreams Come True

Ultimately, these top private hard money complaints are not enough to deter those business-hungry individuals who want to make their dreams come true. In fact, private or hard money lenders, especially in California, are actually in the business of making hard to approve dreams come true. So, if you are still looking for short-term financing, then it would behoove you to also check out the top advantages of private hard money loans.

Dennis Dahlberg Broker/RI/CEO/MLO
Level 4 Funding LLC
Arizona Tel:  (623) 582-4444
Texas Tel:      (512) 516-1177
Dennis@level4funding.com
https://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.