Hi Friends!
This is your Hard Money Lender in Tucson and the Southern Arizona area, Billy A. I found a great article on Hard Money loans I thought was worth sharing to explain the process more effectively.
What is a Hard Money Loan?
If your business is in a position where you cannot qualify for a traditional business loan but you need money to complete a project or for another reason, a hard money loan may be a route you can take. Hard money loans are non-traditional, alternative sources of small business financing. They are used when you can’t qualify for financing for your small business operations using traditional sources of financing or you need money quickly and you can’t wait for regular commercial financing.
Why go the Hard Money Loan Route?
A hard money loan is a risky asset-based loan used by companies that cannot qualify for other types of loans to finance their operations. If a project comes up in which a small business wants to invest or if a company has used up their lines of credit, they can turn to hard money loans for their needs. Hard money loans are placed with private investors, banks, mortgage companies, and even the Small Business Administration.
How do you Qualify for a Hard Money Loan?
Hard money loans are not based on the creditworthiness of the borrower. Instead, they are based on the collateral you can offer to the lender. Your credit score is usually not considered. Only the collateral you can offer the lender is considered for a hard money loan. Usually, the entire value of the collateral is not used. Instead, a loan to value ratio is calculated for the hard money loan. The loan to value ratio is a percentage of the property’s value. If the collateral you offer for the loan is not enough to secure the loan, you may have to offer up personal assets to secure the loan.
I hope that helps explain the process a little better for those who are new to the private lending arena. That’s it for day! Let’s make it another great day!
Your Hard Money Lender in Tucson and Southern Arizona,
Billy A
P.S. I want to be your favorite Hard Money Lender in Tucson and Southern Arizona, so please don’t keep me a secret! If you, your friends or family need help with funding, I’d be happy to give them free information without any obligation. Please give me a call at: