When to consider getting a hard money loan
Hard money loans are used as investment tools by investors. They are useful in a few situations, such as:
- Unable to get financing elsewhere. Funding real estate investments is tricky. Traditional mortgages are difficult to get under normal situations. Banks are very cautious of making loans for investments, as opposed to loans for residences. As a result, if you’re looking for investment funds – then get a loan.
- You have a poor credit history. loans are based off the collateral of the investment, not your ability to repay. Loans made to consumers – as opposed to lenders – are based off your ability to repay the loan. This means if you have a poor credit history, or no stable income – then you might not get approved for a loan.
- You need money. loans are great so you can get money ASAP. Traditional loans take time. is very fast. If you need to capitalize on an opportunity immediately, then you can get a loan. If you can wait several weeks, then it’s better to get a loan.