A “hard money loan” is a form of real estate-secured asset-based financing. As a short-term loan with a quick approval process that doesn’t require a credit score, it can be used for a variety of purposes. Unfortunately, hard money loans are vulnerable to a great deal of misunderstanding. Several examples of this are displayed below:
They Are Only Intended for Those with Poor Credit
Regardless of your credit score, you can acquire finance with hard money loans (good or bad). It may be essential for those who are facing an emergency but are unable to obtain financing due to their credit score. However, a lot of businesspeople find it convenient due to the quick approval process. It saves time and lowers the possibility that delays may cause you to miss an opportunity in the real estate market. For those who would have been excluded by traditional banking, it expands their options.
Hard Money Loans Have Extremely High Interest Rate
Even while the rates are typically greater than your mortgage, they are significantly lower than those offered by a traditional bank. The terms may last anything from three to 36 months. Because of the reasonable costs they offer, they are often sought after by prospective fix and flip business owners.
Consumer Lending Rules and Regulations Don’t Apply
The idea that hard money lenders are ruthless loan sharks who will lend to anyone is another common misunderstanding. Many providers have stringent guidelines that adhere to an extensive procedure. Businesses must also have licenses and adhere to the guidelines established for hard money lending. Every jurisdiction has its own set of rules for which Florida hard money lenders must comply.
Monroe Funding Corp has a wealth of experience and knowledge to help you reach your investing goals. To learn more about Florida Commercial Real Estate Loans, contact us online or by phone at +1 (954) 419-3539.