You've found a great opportunity to make some money. You've heard about hard money bridge loans but you don't know what to expect? Here are some of the basics:
The biggest advantage of a bridge loan is the lenders are always concerned about the value of the property, not so much you personally. In other words; the property is what secures you the loan not your current credit status. It's all about the value of the property.
The life of a bridge loan is approximately one to six-months; although you can get an extension of up to 2 or more years. Again, these lenders are not your average banks. The flexibility of this type of loan is why you will either get approved (or not) in as little as 2 days.
You may be asked by the lender why are you looking for a hard money loan instead of a traditional loan? There are many reasons why someone may consider using hard money loans. Most likely your response will be because you need the money now and not three months from now when the window of opportunity has most likely closed, or you may respond that your credit has some blemishes, filed recent bankruptcy, low occupancy levels, etc.
Some of the things your hard money loan lenders want to know will be: the type of collateral, the location and approximate value of the property, the amount owed and most important, the exit strategy of the loan or how will you pay the lender back.
Most bridge loan firms want your business and will work with you to get you 60% - 75% financing. (In some cases you can get 100% financing if you have additional assets to put into the deal.) In 99.9% of most cases, the hard money lenders are private companies, and you won't typically get 100% of the value of the property. The low loan to value is in place to protect the lender in case of default on the loan.
Be prepared though, the interest rate on hard money loans is much higher than on traditional loans. Expect 10 to 15%, depending upon the overall risk. There will also be points or origination percentages that range between 1 and 5% of the loan amount set forth by the lender and assessed at the close of the deal. However, the higher interest rates, flexibility, and the quick turn-around often offset all the paperwork and time involved with traditional banks.
Some hard money lenders charge a fee for pre-payments, some charge an exit fee for the hummingbird loans direct lenders for short term loans and others charge nothing. Make sure you know exactly what the terms of the proposed hummingbird loans loan for 5000 no credit check are before engaging any lender. A detailed letter of Intent is an excellent way for you and the hard money lender to understand exactly what is expected by each party. One more thing, if you are not familiar with bridge hummingbird loans short term loans lenders do some in-depth research first. Talk to others who have experience with hard money bridge loans or ask your lawyer for some help. Don't forget, there is plenty of information on the web that you can use to your advantage.
Are you looking for the best deals and rates on bridge loans? Visit http://directmoneylenders.com/ today for more information!
|Created||22 Aug 2018|
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