Kinds of Money Lenders

Kinds of Money Lenders

There are different types of money lenders and this article deals with the different types of money lenders present in the market scenario. Some of the different types of money lenders are

• Mortgage bankers
• Mortgage brokers
• Wholesale Lenders
• Portfolio lenders
• Direct Lenders
• Correspondents
• Banks and Savings & Loans
• Credit Union

Mortgage Bankers

A mortgage banker is a lender that can originate loans which they can sell to Fannie Mae, Freddie Mac, Ginnie Mae, jumbo loan investors, and others. Thus a company who is capable of doing the above function is termed as a mortgage banker; however their size differs based on the different companies. Some mortgage bankers service the loans to the customers which they have originated while others do not. Most of the brokers have wholesale lending divisions. Some of the examples of mortgage bankers are Countrywide Home loans and Wells Fargo Mortgage. In this example one company is associated with a bank while the other is not. Many companies call themselves as mortgage bankers while some are really bankers but as far as the case of the others is considered it is mostly marketing.

Mortgage Brokers

Mortgage brokers are institutions who originate loans with the intention that they would give the amount to wholesale lending institutions. A broker has contacts or a set relationship with these wholesale lending institutions. Underwriting and the activity of funding takes place at the wholesale lender. They deal with the institutions that have wholesale loan department.

Wholesale Lenders

Many of the mortgage brokers and even the portfolio lenders act as wholesale lenders. They cater to the need of mortgage brokers for the origination of loan. There are some wholesale lenders that do not even possess their retail branches as they rely on mortgage brokers for the loans.

Portfolio lenders

An institution which lends own money and originates loans for itself is referred to as “portfolio lender”. Thus in this way they are lending their own portfolio of loans and they are not concerned about being able to sell them on the secondary market. Thus they need not abide by the rules of Fannie/Freddie guidelines and thus they can create their own rules for ascertaining the credit worthiness. Usually portfolio lenders are large banks. Only a particular part of their loan programs are portfolio products. Incase they are providing fixed rate of loans or government loans, and then they are definitely engaging in mortgage banking as well as portfolio lending.

articlesbase.com

Hard Money Lenders

About Hard Money Lenders

America is going through tough financial times; it is no secret that many Americans have fallen victim to unscrupulous lending practices and that the most important terms and conditions were not disclosed during the negotiation of a home loan. We are going through a financial bubble and because of reforms to lending practices home owners are desperate because they no longer qualify for readjustments with their current lender.

As the saying goes, desperate times call for desperate measures but, that measures that most people are taking are definitely not the best ones. A few years ago property owners counted with their home equity to bail them out of any financial problem but because of the current situation properties have partially lost value and there might not be enough equity to refinance a loan; unfortunately for home and property owners, credit card companies know that the average American no longer counts with equity in their properties so they are constantly bombarding people with ephemeral offers which later on turn into enormous headaches.

But the solution to a tight financial situation is not to turn to credit cards because their interest rate can go as high as 30% (compounded daily) and they will just add to the problem. Hard money loans on the other hand, are better financial instruments which provide affordable interest rates and terms that will help any property owner sail through this economic recession.

Hard money loans can go as high as 70% LTV (loan-to-value) but, the best case scenario would be to keep the LTV below 65% in non-owner occupied homes, hard money loans can also be issued on an owner occupied property to relieve financial stress. These types of loans can be amortized over a period of 30 years according to the borrower needs

Stopping Foreclosures with Hard Money Loans

Because of the banking crisis more and more home owners are losing their properties to foreclosure, the sad part is that many of those foreclosures can be stopped or avoided only if the note holder deals with a knowledgeable hard money lender. In California alone foreclosures have been up 260%, this figure is based on market analysis performed on July, 2008 by housing authorities.

Hard money loans can be used in order to salvage a property and avoid foreclosure. However, a property owner needs to act as fast as possible in order to avoid interest and penalties from accruing and worsening the situation.

articlesbase.com

How To Find and Market To Private Money Lenders

How To Find and Market To Private Money Lenders

As I've said before, every business on the planet is in the business of MARKETING.

Yes, that includes you.

First and foremost you are a marketer, second you are an investor. You must know how to get leads in order to even have a chance to put your investment knowledge into action.

So, to get private money lenders for your real estate investing business you must find the people who have money.

Who Has Money?

* Your Family and Friends -

Do you have family members who have money that they are earning between 0-5% on? I'm sure you do. Do you think they would want to double the rate of return on their money? I bet they would.

So, why not bring the opportunity of becoming a private lender for your real estate business to your family members first, so you can help your family become more wealthy in the process? Many people hate to ask family members for money... this is a common thing; however, why would you feel uncomfortable helping your family members make more money? You shouldn't.

The first property I bought (and still own) was bought with 100% private money. A 95% first mortgage (seller carried), and a 5% second which was borrowed from my father. My father is earning 6% on his money rather than 3%, the property cash flows and has gone up in value... if for some reason I screw up and don't pay my dad (not going to happen), he is in 2nd position on a property with over $100k in equity. It is a no lose for him... and great upside for me.

* Other Real Estate Investors and Businessmen -

Other successful real estate investors have money... and often like to lend out their money to other investors. These are often great private money investors to have on your side because as you're starting out, they can help you analyze deals... and teach you a ton as you grow as an investor. Also, successful businessmen are great because they know the security that real estate can hold, and know that when the loan is structured correctly they are protected with very little downside.

Talk to other investors and business people that you know and let them know what you do, and that you can provide them real estate secured returns of 9-12% (or whatever you are willing to pay) when they become a private money lender for your company. If there are holes in your presentation or your business model, they'll likely point them out, which will help you to make your business stronger over time.

* People Nearing or in Retirement -

Think about it... who has a bunch of money just sitting around? Well, people either in or nearing retirement (people 10-15 years away from retirement, up to people who are already retired). Even better, the stock market today sucks and I've personally seen many people move their money from the volatile stock market and place the funds in "more secure" investments like CD's, gold, etc.

It's your job to find these people and present them another option to lend money to your company for a much better annual return (usually private money lenders are paid between 8-12%). Show them that you know what the heck you are doing, that the risk is relatively low with the strict buying guidelines your company employs, and that you are looking for long term relationships with lenders who want the same.

These people can move their under performing investments (401k, IRA, etc.) into your short term private money loans. It's a win-win. Again, you as the investor need to be honest with the private money lender, and you need to make responsible decisions on the properties that you invest in.

That's just a short list of people who you should be going after to recruit as private money lenders for your real estate investing business.

Marketing to these people can be everything from simply handing them your business card that has a blurb saying you are looking for private money lenders who want to earn 10% secured by real estate, and to call XXX-XXX-XXXX or visit www.yoursite.com for more information

... to sending out mailers to a list of retirees... to teaming up with a financial planner, to putting on free seminars about the opportunity, etc.

***FYI, I am not an attorney, and don't claim to be. I am just throwing out ways you may be able to market to potential private money lenders, to my knowledge they are legal, but advise your attorney before you use any of them.***

Here are a few ways you can get in touch with potential private money lenders:

* Ask sellers of the properties you buy if they'd be interested in becoming a lender for your company
* Talk to family about the opportunity and ensure to structure the deal so they virtually can't lose, and that the risk is on you (unless you want to lose a family member if a deal goes south)
* Ask other investors at real estate investing clubs in your area
* Put up a website and get it optimized in the search engines (we're creating a training session on this)
* Network at events (chamber of commerce, etc.) and let people know what you do, and how they can be involved
* Send out postcards to a list of people with over $500,000 net worth (you can buy lists from companies who can break it down by net worth and other factors)

Really, there are endless ways to recruit potential private money lenders; however, in my experience... the best ways are to network, let people in your area know what you do, create a website which educates potential lenders, and get referrals from happy investors.

articlesbase.com

How to Get Private Money Lenders and How to Keep Them Long-term

How to Get Private Money Lenders and How to Keep Them Long-term

Finding a private money lender is an essential part of any real estate investor’s business. In the old days (pre 2006) you could easily get a mortgage or even hard money loan simply by showing up in the lenders office and filling out an application. If you could walk and talk you qualified for a loan.

But today in the post credit-bubble market those days are over. Getting money for your real estate investing business is much more difficult and likely to get even more difficult as the credit markets sort things out. So how do you get money for your real estate investment business?

The answer is a private money lender.

One of the keys to finding a good private money lender is determining if they have similar goals and objectives as yours. You need to understand what they are trying to achieve and if your private lending program fits their needs. For example, if the private money lender wants an investment for a 10 year period, but you plan on doing quick flips every 6 months, it will not be a good long-term relationship. You and your private money lender need to have similar goals for a good long-term relationship that will result in repeat business.

So how do you determine if you and the potential private money lender have similar goals. You need to discuss your plan and ask questions similar to a job interview. We would recommend a series of questions similar to those listed below. Obviously, you can modified these questions to fit your personality, but the information you get will go a long way in determining if this is a person you want to do business with.

Important Questions to Ask

• How much do you have in liquid funds?


• Do you have other monies you might want to consider for an investment program that pays 9% to 15% and secured by local real estate?


• What type of investments are you in right now?


• How much are they making on your current investments?


• How long do you want your money invested for and do you have plans coming up that will require your principal back?


• How available is your money or is it tied up in investments that are not readily accessible?


• Are you a “Qualified Investor” (person must either have a net worth of about a million dollars or have an annual income in excess of $200,000)


• Do you know anything about real estate investing?


• When would like to start investing?

Asking these questions will flush out how close your goals are and will foster a good long-term relationship.

articlesbase.com

Private Hard Money Lenders and Working With a Commercial Mortgage Broker

Private Hard Money Lenders and Working With a Commercial Mortgage Broker

Private hard money lenders are in the business of providing loans and loan services to people who require hard money loans (loans collateralized by real estate.) Private hard money lenders may be direct hard money lenders or brokers of hard money loans. Most private hard money lenders are, in actuality, brokers. Some private hard money lenders are both brokers and direct lenders. In these cases, the private hard money lender generally funds one or up to a few small loans per year and serves in the broker capacity to clients for the loans they help to originate.

Deciding on whether to work with a hard money broker or a private hard money lender is similar to deciding on whether to purchase real estate with the assistance of a broker/agent or whether to make an offer direct to the seller on your own.

The advantages of working directly with a true private hard money lender are immediately evident: You may sometimes save money by going direct. Brokers are paid for their services via a percentage of the points you pay on a hard money loan. Therefore, the more brokers involved in a deal, the more you are likely to pay in both points and percentage to accommodate that cost.

If you have selected a direct hard money lender who is a good match for your project, you will be able to speak directly with the decision makers, avoiding the 'run around' that so many hard money borrowers fall prey to. You are told that your loan is going through, only to hear the next day that the lender has elected not to take on your hard money loan and now your loan is on another desk in yet another direct lender's office - or worse, on the desk of another broker who may know a broker who knows a lender who may want to fund your loan. Sometimes, the choice of direct lender is based more on the commission the broker will get than on your best interests.

By working with a direct hard money lender, you can avoid the 'run-around' and may be able to close more rapidly. After all, no one knows your situation like you do, no one can explain any extenuating circumstances better than you can, and no one is as committed to your business and your hard money loan as you are.

The advantage of working with a commercial mortgage broker is also clear: a seasoned, well-informed, honest commercial mortgage broker will have the knowledge of and access to the direct hard money lenders in Ontario, Canada, and the United States. A commercial mortgage broker will know where your loan has the best fit. A good commercial mortgage broker will help you 'package' your loan to your best advantage, helping you determine how much to expect based on the equity in your property, type of property you are collateralizing, how soon you need to close the deal, and more. A good commercial mortgage broker will be able to assist you through the lengthy application process and submit your loan request to the best direct lenders for your situation. More often than not, working with a commercial mortgage broker will save time. By representing you and presenting your loan request to the best direct lenders, it often makes the transaction run more smoothly and take less time than if you were to take on this task yourself. This often saves you time and trouble in the long run and be well worth the cost of using a mortgage broker.

articlesbase.com

How To Compare Secured Loans

Here the more tips about how to compare secured loans:

When you are thinking about taking out a loan, you need to think about which kind of a loan. There are basically two types you can choose from: secured and unsecured. Secured loans require a form of security to guarantee the loan. This is commonly your house, which makes secured loans only really suitable for homeowners. But all secured loans are not equal. You need to carefully compare secured loans that you find on offer to get the best deal you possibly can.

Secured loans have the big advantage of having lower interest rates than unsecured ones. The downside, or potential downside, is that your home can be put at risk if you default on the repayments. For this reason you should always compare secured loans and choose one that also offers some form of payment protection insurance.

This kind of insurance can be purchased separately, but may be offered as part of the package. However, this is another situation where you can shop around and get the best deal you can. Payment protection insurance is sometimes known as accident, sickness and unemployment insurance, which refer to the three main situations that you may face that could prevent you from repaying your loan. This is why it is vital that you have some kind of protective insurance cover in place to allow for the worst event possibly happening.

With any type of loan, and a secured loan is no exception, the main element you should look carefully at is the interest rate. Depending on who is offering you the secured loan, you will find that the interest rate will vary, sometimes quite substantially so. You can, of course, do this work by yourself, or you can obtain the services of a broker to do it for you.

A broker will search all the companies offering loans and compare secured loans on your behalf. You will usually then be presented with the most favorable option. This should be the one that offer you the best interest rate and repayment conditions. You should look for flexibility here. The more flexible the conditions are the better.

For example, although you will agree to repay the loan over a set time period, suppose you suddenly and unexpectedly find yourself with a lot of money to hand. You may have had a lottery win, or inherited from a wealthy relative. While the details are not important, you may in this hypothetical situation wish to pay off your loan earlier than originally agreed. If you then discover that there are penalties in place for early repayment, it will make sense to continue paying off the loan at the agreed rate.

However, if when you compare secured loans you also seek out the offers that have flexibility built into early repayment, you would be able to pay off the loan at a time that suits your financial situation without penalty, and you would thereby save some money by not paying continued interest rates.

It is important that you carefully compare secured loans to find the best one for you. They are not all equal, though they are fairly similar in nature. Shopping around while being fully aware of the pros and cons is wise, especially as you are dealing with your hard earned money.

Different Types Of Loans And Loan Options

Different Types Of Loans And Loan Options

A loan is the redistribution of money between a lender and a borrower. As a borrower, you receive an amount of money from the lender, which you will have to pay back later. This service is provided at a cost, referred to as interest, or annual percentage rate (APR).

Installment loans are loans that are repaid in equal monthly payments within a specific period of time. Installment loans come at a cost. This includes the APR (an interest rate) and the finance charge. Cars, furniture, computers or household appliances can be purchased with installment loans. Compare fixed-rate loans, where the interest rate stays the same throughout the loan term, with variable-rate loans, where the interest rate can change during the period of the loan.

Secured loans imply that the borrower offers a guarantee, or collateral, for the loan. The borrower has a claim on this collateral as a repayment source if a loan is not paid pack in cash as agreed. For example, a home mortgage is a secured loan - the bank loans the majority of the purchase price of the home, but retains a lien against the home for as long as the loan is outstanding. Unsecured loans are loans that are not secured by collateral, such as credit cards. Because the lender holds no collateral, unsecured loans hold significantly more risk for the lender, which is usually reflected in a higher interest rate.

Rent-to-Own Services allow you to rent an item for a period of time, in exchange for weekly or monthly payments. These agreements are not loans, so no interest is charged. However, typically you pay 2 to 5 times more than the cost of the same item at a store. For example an electronic store sells a TV for $1,500. A nearby rent-to-own store offers the same TV with a payment plan of 52 payments of $55 every other week. If you multiply 52 weeks x $55 payments, the total cost for the TV from the rent-to-own services is $2,860! If you miss a payment you can lose the item and all the money that you have already paid towards owning it!

Payday loans are cash advances given in exchange for a written check from your bank account. Your check is held until your next payday and then cashed. These loans are costly with a typical payment of $15-$35 for every $100 you borrow. This might not seem like a lot of money but imagine that for a $200 loan you agree to pay back $260 in 2 weeks. You pay $60 in interest which is the equivalent of a 782% annually!

TIP: Before you take out a loan compare fees and interest rates. Make sure you understand if the interest rate can change over the life of the loan. Remember there are alternatives to payday and rent-to-own services. Your community organization, bank or credit union may offer small, short-term loans at more reasonable rates. Paying for an expensive item in three or four installments could save you money! Shop around before you buy and never feel pressured to make a purchase.

articlesbase.com

How To Compare Loans

Here the explanation how to compare loans:

Not so long ago if you wanted to take out a loan you had little chance to compare loans, and little choice about where you borrowed. It was either the high street bank, or a building society or friendly society. And the amount you borrowed was severely restricted too. You were mostly relying on the generosity of the bank manager and hoping that your credit record was good enough. If not, then too bad - no loan for you.

Today you are spoiled for choice. Banks and building societies compete with each other endlessly. The situation has almost gotten out of hand with the people throughout Britain owing in excess of one trillion pounds. That's a whole lot of money! And that's why it's important that you carefully compare loans when it comes time to borrow any sizeable amount of money.

Loans are not all made equal. You have to read the small print carefully, or have someone who is qualified explain it all to you. For example, if you found yourself in a position in say a year's time to pay off a loan that was intended to run for five years, would you be able to do so without incurring a penalty? You should always try to build in as much flexibility as possible into any loan you take out.

Loans come in two basic flavors: secured and unsecured. A secured loan is one where something you own of value, usually your house, is used to secure the loan. If you fail to pay back the loan then your house, or whatever secured the loan, is forfeit by you. An unsecured loan, or personal loan, is one where there is nothing securing the loan. These kinds of loans are usually for lesser amounts, and your credit history becomes an important factor in the decision of whether or not you get the loan.

Both secured and unsecured loans can have many similar features that you should take into account when you compare loans. One of the most important things to consider is the interest that will be charged on the loan. Obviously, the lower the interest rate charged the better, as you will have to pay less back overall. Generally speaking, the better secured the loan is, and the better your credit history is, the better the chances are that you will get a low interest rate charged.

Payment protection insurance is common. As the name suggests, it protects your payment ability. If for whatever reason you become unable to make a payment, then you can draw on the payment protection insurance without incurring problems. Of course, you should always look carefully at your personal circumstances, both in the present and what you reasonably expect to be the case in the future. The unforeseen can always happen, and no one can guard against it, but you can prepare for what is likely or expected.

There is a lot to consider when you compare loans. You should never just accept a loan because it's from your bank who knows you well, which will make it easier all round. By looking carefully at what is on offer you can usually get a much better deal that will be better tailored to you. The organisations that lend money are not doing anyone a favour; it is a business transaction where you help them, and they help you. Always keep that in mind when you compare loans and it will help you to make the right decision every time.

Hard Money Loan: Financial Backing for Commercial Dealings

Hard Money Loan: Financial Backing for Commercial Dealings.

Have you been looking to buy a property for long and it is on sale now. To your disgust you are suffering from insufficiency to fund your dealing. If it is the case with you, then hard money loans can solve your problem. With hard money loan money is lent primarily to help you buy a commercial property. Hard money loan can be borrowed from private firms or even individual lenders. However these are not offered by government agencies.
Lenders disburse the money on the basis of the value of property you are buying. They are never concerned about your credit rating. Even people with CCJs, arrears, bankruptcy etc are eligible for hard money loans. So, it is better to look for a hard money loan instead of a traditional loan when you need a comprehensive amount and are in urgency.
Hard money loan is also a good option for those who need money to renovate their property before selling them. Once, your property is renovated, you can raise its market value and then you can easily repay your borrowed amount by selling the property.
Hard money loans come at little higher interest rate as they are meant for people looking to materialize some commercially viable opportunity and also for those who have poor credit ratings. Even then it is a better option to go for than to look for financial partners or to file for bankruptcy. Most of the lenders will offer you loan at a bit higher interest rate and it can be marginally higher than what you get with other traditional loans. It should not be misunderstood that hard money loans are difficult to be repaid. You can use the money to add the value of your property then repayment becomes as easy as any other loan.
Since majority of these hard money loans are disbursed by individual lenders and the approval entirely depends on their discretion .Once you get an affirmation it is a matter of 7-14 days that you can acquire the amount. There is minimal documentation involved and the process need not go through various official steps.
Hard money loans have a timed value of money as they are available when you need some for your commercial transactions. So if you find a lucrative property in offering or you simply wish to add value to your property to squeeze the maximum out of its resale value and you don’t have adequate finance you can opt for hard money loans.

How Hard Money Loans May Help you

How Hard Money Loans May Help you

The expectations of lenders can be excruciating for borrowers. The down payment required for an acceptable LTV combined with the minimum credit score are enough to lead potential loans to what looks like a dead end. However, in some cases hard money loans are the perfect remedy.

Often times hard money lenders are confused with venture capitalists mostly because private investors are involved. Banks and lending companies arrange the loans with help from the investors who are seeking a reasonable return.

Clients also tend to request specifics that are determined by a review of their loan request and financial status. For example, lenders can typically tell someone what interest rates range from, but one must apply in order to receive a quote. Since each person may qualify for different terms, rates and amounts it is only rational to review the pros and cons so you may determine whether or not it’s worth it to pursue a hard money loan any further.

One benefit for borrowers who utilize hard money loans is that the lenders do not focus so much on their credit scores as they do on the value of the property used as collateral. Most lenders have a limit on the LTV of the property used for collateral. This can range from 50 percent to 85 percent and is completely a case-by-case basis. If there is enough equity, the value of the property will need to be proven through an appraisal. Some lenders accept appraisals that are new enough, while others demand that new ones be completed.

Another benefit of hard money loans is how quickly they close. Many borrowers take full advantage of this even if their credit is excellent, simply because they prefer a hassle-free transaction that doesn’t drag on for a month.

Individuals in pre-foreclosure or bankruptcy are also able to obtain hard money loans so long as the lender is convinced that the borrower has sincere and verifiable intentions to dig themselves out of the financial hole they’re in. More times than not, this is one of the exceptions where a borrower’s income can be the determining factor for receiving the loan. If they are able to demonstrate that the debt can be repaid, a hard money loan can very well become their life raft.

With interest rates that reach 18 percent (or higher) and fees that climb to 6 points plus, there are obvious disadvantages that may scare borrowers off. This is not always the case, which is where due diligence on your part comes into play. One can quickly determine whether or not the interest rate and fees being offered are reasonable in relation to their situation by reviewing multiple offers from different lenders and asking questions. Similarities in the offers signal that you’re probably pretty close to the best amount you can get.

In the end, obtaining financing really comes down to: Convenience & Reliability vs. Amount & Terms. How quickly you want the loan and how dependable you are to repay the lender determine what you will get. And on a final note, a few minutes spent on the phone with anyone specializing in hard money loans will help you see past any presumptions so you can focus on what you qualify for and how it will help your goals.

Three Business Scenarios Regarding Commercial Hard Money Loans

Commercial Hard Money Loans - Three Business Scenarios

The primary rationale for a business considering a commercial hard money loan is that traditional commercial financing options are not viable. There are three financing options for most commercial real estate scenarios: traditional banks, intermediate lenders and hard money lenders. In those situations where traditional banks and intermediate lenders both say "NO", it then makes good business sense to explore under what terms a hard money commercial loan might be available.

Many viable business projects can be funded ONLY via a hard money lender. Before accepting "NO" from the traditional banks and intermediate lenders as the "FINAL ANSWER", a prudent small business borrower should determine if a hard money lender will say "YES".

Compared to traditional bank business loans, commercial hard money loans will generally involve a higher interest rate (prevailing range of prime rate plus 4-8% for typical scenarios), higher fees and shorter-term financing (one to three years). However, because many hard money loans offer interest only terms, the payments can be lower than a fully-amortized loan with a lower interest rate. Commercial hard money loans are typically completed more quickly than a traditional commercial loan.

Several common commercial financing scenarios using hard money loans are described below.

COMMERCIAL HARD MONEY LOAN SCENARIO # 1:
Need to Obtain Commercial Financing Quickly

Traditional commercial loans will normally require several months to complete. Hard money loans can be obtained within a few days in some situations. This difference will be critical if commercial financing is required within a short time frame.

COMMERCIAL HARD MONEY LOAN SCENARIO # 2:
Special Small Business Situations Not Easily Understood by Traditional Banks

• Foreclosure
• Bankruptcy
• Special Purpose Properties
• Tax Liens
• Losses
• Negative Net Worth
• Less than one year in business
• Environmental Requirements

COMMERCIAL HARD MONEY LOAN SCENARIO # 3:
Low Credit Scores

Most traditional commercial loans have very strict standards for acceptable credit scores by the guarantors for a commercial real estate loan. Hard money loans are much more flexible and low credit scores are acceptable.

As noted above, there are several common business situations in which a commercial hard money loan should be considered as a viable commercial financing option. The Commercial Mortgage Loans Guide (http://aexcfgllc.com) and The Credit Card Receivables Guide (http://aexcfg.com) will provide additional insights into viable commercial financing strategies for difficult commercial loan scenarios.

Copyright 2005-2006 AEX Commercial Financing Group, LLC. All Rights Reserved.
articlesbase.com

Commercial Hard Money Loan Education

Educate yourself More Regarding the Commercial Hard Money Loan.

As for the basic definition of a Commercial Hard Money Loan, it can be described as a Cash Finance Option or Business Loan for someone who has trouble getting a regular financial loan. They are always given to someone with Real Estate as the collateral asset. If the borrower can't pay back the loan, the Real Property is taken as collateral to ensure the Commercial Hard Money Loan eventually gets paid back.

The basic key of the various types of Commercial Loans can also be defined as Sub-Prime Lending, Near Prime, B-Paper or Second Chance lending options.

So affirmatively would someone take out a Commercial Hard Money Loan verses a standard Commercial Loan? It's because there are determining factors such as Moderate Credit Score, Organization History, demonstrated actual Income Level that would suppress someone from getting prime money financing or custom rates, so the debtor in these cases will settle for what they can get.

Some companies have a minimum amount they will lend you when helping you acquire a Commercial Hard Money Loan. The companies we have researched start out at $300,000 and go up into the millions for Commercial Real Estate Properties.

There are also what they quote Mezzanine Loans which is a an accommodation that's paid back after the transfer or refinance of the Commercial Property. It's possible for a lender to secure a portion of the proceeds upon sale of the Hard Loan debt. These loans tend to have preferable structures such as good debt and equity ratios.

Maybe you have or haven't heard of a Hard Money Bridge Loan. These types of loans basically "bridge" the gap so in essence you can get a project off the ground a lot faster. You will pay more for this type of loan, sometimes up to 5% more, but the key is you can get your project going now. You can get a loan like this for as much as you want, there is no upper ceiling on it.

There are also Hard Money Construction Loans, which is another distinctive Money Financing option that can be used for little home projects to larger Commercial Property projects such as the development of a strip mall or tract home development project. In most cases for construction projects there is a reserve account setup to make sure that money is allocated properly as the project keeps moving forward.

A Commercial Hard Money Loan is typically used in both Urban & Suburban areas. The current Prime Rates are from 11 - 16% verses the 6-7% for a standard loan. Usually all associated Points & Fees are included in the an accommodation and payments from these are dispursed upon closing the an accommodation. Also note these are Short Term Real Estate Loans that are usually given from 1-3 years.

I could write a small 100 page book detailing all the features regarding all the types of Commercial Hard Money Loans. The the main point you need to be aware of is that you should pay around 11-17% interest on one of these. If you are paying 20% upwards, that could be considered Predatory Lending. I was in a court room once where the judge and an attorney from a nationwide hard lending firm were battling it out for almost 40 minutes on what is and what wasn't appropriate interest rates to charge for these types of loans. Be careful and always investigate before making your move.

Hard Money Loans - the Answer to Your Problems?

Continue for the recent post:

These days, nothing in our economy is certain. In reality, many people and businesses are still in good financial shape, but for many others things have gotten quite a bit more difficult in recent times. Some people have had to close their businesses, and been foreclosed upon. Unfortunately sub-prime mortgage loans have gone the way of the dinosaur, due to the recent nation-wide crisis of which they were the center, and it’s become more and more difficult to know where to turn when your financial wellbeing is on the line.

If you’re one of the many, stuck between a financial rock and a hard place (or a foreclosure and a bankruptcy, as the case may be), it may be advantageous for you to look into taking out a hard money loan. Hard money loans are utilized by many people facing foreclosure or similar financial disaster, as the criteria for lending is more relaxed than a conventional loan. While your credit history is still taken into consideration by the lender, it’s typically not judged as harshly because the loan is given based on the value of real estate property you already own.

Due to the slightly higher risk to the lender when dealing with hard money loans, they are not provided by banks but rather by private lenders, and as such, the interest rates of these loans aren’t based on bank rates. Typically the interest rate on a hard money loan will range from 15% - 25% (a little less for bridge loans, which are similar, but not necessarily used in times of financial hardship), which means that you probably don’t want to look to hard money loans as sources of long-term financing. In fact, the term is often fairly short. Think carefully about whether or not you’ll be able to handle the loan, as the rates may increase to the legal state limits upon default, which can be as high as 25% - 29%.

Typically the value of a hard money loan is about 65% - 70% of the value of the property. This is known as the LTV (Loan-To-Value). The average LTV used to be higher than it is now, however due to rampant lender overestimation of property values in the ‘80s and ‘90s, interest rates were raised, and LTVs lowered. Now, hard money lenders typically want to be in the "first lien" position (meaning their lien takes priority over all others) on a given property, so if the value of the property isn’t enough to cover the existing mortgage, the loan will need to be cross-collateralized with another property. These cases are often referred to as "blanket mortgages."

It’s important to review your financial situation thoroughly when considering taking out a hard money loan, and it might benefit you to talk to a certified mortgage planner before you make the choice to do so. In the right circumstances however, a hard money loan may be what it takes to tide you over, and keep your business from going under.

articlesbase.com

Hard Money Loans for Your Business

Do you ready for a business..? and you do not have enough fund for running your business..? May be Hard Money Loads is the answer for your problem...

Nothing is certain in our economy these days. Many people and businesses are still in quite good shape, but plenty of others haven't been so lucky, and have had to close their businesses, and have filed bankruptcy or been foreclosed upon. And now, unfortunately, sub-prime mortgages aren't available for assistance they way they used to be, due to the recent subprime mortgage crisis. It's become much more difficult to know where to turn when it's your financial future at stake.

If you're one of the many, stuck between a financial rock and a hard place (or a foreclosure and a bankruptcy, as the case may be), it may be advantageous for you to look into taking out a hard money loan. Hard money loans are utilized by many people facing foreclosure or similar financial disaster, as the criteria for lending is more relaxed than a conventional loan. While your credit history is still taken into consideration by the lender, it's typically not judged as harshly because the loan is given based on the value of real estate property you already own. Due to the slightly higher risk to the lender when dealing with hard money loans, they are not provided by banks but rather by private lenders, and as such, the interest rates of these loans aren't based on bank rates. Typically the interest rate on a hard money loan will range from 15% - 25% (a little less for bridge loans, which are similar, but not necessarily used in times of financial hardship), which means that you probably don't want to look to hard money loans as sources of long-term financing. The term is, in fact, often fairly short. Decide carefully if you'll be able to afford the loan, as interest rates upon default may increase to the state limits, as high as 25% to 29%.

Typically the value of a hard money loan is about 65% - 70% of the value of the property. This is known as the LTV (Loan-To-Value). The LTV, on average used to be a bit higher than it currently is, but due to property value overestimation in the 1980s and 1990s, the LTV was lowered, and interest rates raised. Hard money lenders do usually want to be in "first lien" position (this means that their lien would take priority over any others) on a property, so if the value of that property isn't enough to cover your existing mortgage, the loan would need to be cross-collateralized with another one of your properties. Often, these cases are called "blanket mortgages."

It's important to review your financial situation thoroughly when considering taking out a hard money loan, and it might benefit you to talk to a certified mortgage planner before you make the choice to do so. In the right circumstances however, a hard money loan may be what it takes to tide you over, and keep your business from going under.

articlesbase.com

Understanding Hard Money Loans

You need understand abut hard money loads before you make an action...

In the current financial scene, there is such a concept as hard money loans. The credit facilities are standing by its namesake. Hard money is the amount of loan that is usually hard to outsource especially in the current credit industry situation. There are many lenders and loan providers that are operating in the market. Unfortunately, not all of them are ready to provide loans for whoever needs to secure such products. Most general and conventional lenders are very strict in setting standards to make sure their borrowers would not fail on repaying dents to them. That makes lending hard for many people. People with tarnished credit histories are also having harder times finding such loans.

Coastal La Jolla Funding is here to provide the much needed loans for needy people. The company specializes in providing hard money loans. Coastal La Jolla Funding also provides California bad credit loans, bridge loans, real estate or mortgage loans, residential loans, construction loans rehab loans and personal loans. The company initially started to cover the lending market in California, but to date, the loan provider is also providing hard loans to borrowers and consumers across other states like Virginia, Oregon, Michigan, Connecticut, Arizona, Alaska, Colorado, Nevada, Florida and Minnesota. With those expanded branches, the company s able to reach more borrowers and consequently broaden its own market.

The company’s bad credit and hard money loans may start at about $100,000 and may reach up to as much as $20 million. You can easily apply for a loan now and see how you could qualify for larger credit facilities. Coastal La Jolla Funding even takes loans to finance current home constructions. If you are building a house and suddenly runs out of funds, you can opt to take a hard money loan from the company. Coastal La Jolla Funding can commit to finance up to 75% of the request loan. In return, expect that the firm would be securing a 25% to 30% equity in the home construction, which would serve as a collateral. Repaying the loan at agreed upon terms would enable you to regain full equities to the asset.

To qualify for a hard money loan of your type, you could start by filing out an application form online that may take about two minutes of your time. In a matter of hours or days, the company’s contact bad credit lenders and brokers would contact you in the initial phase of the process. For loan applications outside the states covered, be ensured that the company would still be of great help. Coastal La Jolla Funding would refer you to its affiliate lenders and hard money lending contacts within your area.

The maturity terms are another factor. Usually Coastal La Jolla Funding facilitates for loans that are payable for the next six weeks to up to two years. As mentioned above, terms could be extended to 20 years depending on the terms, loan amounts and other loan provisions. The loan could be as large as $100,000 to about $20 million, depending on the collaterals and assets you may be presenting as loan securities. For personal loans, the amounts of loans could vary. You can opt to take smaller amounts or go for the larger. Of course, the company would advise you on which loan product to take considering your payment capacity to avoid future setbacks and troubles.

Coastal La Jolla Funding also serves as a mediator between you, the borrower and the prospective money lending companies that could provide you with the loans. The company is somehow taking some part of responsibilities on your requirements.

In the current lending scene, it is hard to find loan products that would convenient and reliable. That is why if you have urgent needs for loans, make sure you have contacts with reliable and fast loan providers. Entrust your requirements and needs to Coastal La Jolla Funding and see how convenient and effective it is to get a deal with a good hard money lending specialist.

articlesbase.com

Secure Hard Money Loans is Easier

Hard money loans is very easy to secured... not same as the name "hard"...

Hard money loans are among the most popular d widely taken loan products in the market today. It is an irony that the loan type is called ‘hard’ but the application and process of securing the loans are made ‘very easy’. For many borrowers, hard money loan providers ring the bell. That is because such lenders are open in providing poor credit loans, bridge loans, mortgage loans and personal loans. In almost all states in the United States, hard money loan specialists are also one of the most patronized.

Costal La Jolla Funding is probably among the most popular hard money lending specialists in operations today. The company is initially operating in California. Borrowers have been relying on the company for their needs for California bad credit loans, California real estate loans, California residential loans, California construction loans, California bridge loans and California rehab loans. The company has also been reputable in providing hard money personal loans. If you are in need of specific and technical loans, getting in touch with the company would be a great start in your endeavor to search for the best there is in the market.

As a specialist for hard money loans, Costal La Jolla Funding ensures to provide loans that are easily and conveniently facilitated. Thus, the basic market question would be, ‘why are hard money loans facilitated faster and more surely?’ The answer to that hounding question is because such loans are the most in demand in the market. There is an intense competition among conventional lenders. The borrowing market is getting tighter and tighter. Thus, if alternative and non-conventional lenders would get to the same league, they would not score an inch. To be able to lure borrowers and customers, hard money lenders strive to offer loans that are processed at the faster rate, are not too strict on requirements, are able to cover even the numerous bad credit borrowers and are of significantly higher interest rates.

For sure, there is greater risk in providing loans to borrowers with poor credit standing. But many lenders have risked investments and capital to do so. Consequently, those risk takers have succeeded. In fact, in the current setting, growth of risk taking lenders is outpacing growth of conventional lenders. And so many financial lenders and groups are swooning to provide loans to risky borrowers. The market for such loans are wider and are broader, making companies flock in the more.

Costal La Jolla Funding is one of those specialists aiming to underpin the numerous lending opportunities. The company has been taking investments from numerous investors who are willing to take risks in lending money to bad credit borrowers. In return, those investors are expecting to yield higher and better investment returns at the fastest investment periods. Coastal La Jolla Funding facilitates provisions of loans using the investors and capitalists’ money. The borrowers would enter contracts and would commit collaterals. Loans would be provided for a specified period of time and after the maturity, principals plus interest in loans would be processed and would provide the yields to hard money investors. That way, it is logical that hard money loans are processed faster and more conveniently in the current lending market.

Loan amounts, however, could also vary. Significant loans could amounting to about $100,000 to as much as about $20 million could easily be provided for. The terms of the loans are made less stringent, but the interest rates are comparatively at a premium. The qualifications for loans are also relaxed and eased out. If you are taking loans at banks or at other loan providers, you are standing to incur more stress and more headaches in the loan provision.

For hard money loans, get in touch with Coastal La Jolla Funding and find out the appropriate and applicable loan products and terms for you. As a client, you are assured. that the company would give you the best hard money loans at the shortest possible processing and waiting time.

articlesbase.com

Procure Quick Money in Emergency with Cash Money Loans

Think not to make money loan except in emergency situation...

Today, the main purpose of the people is to get money. Everyone knows that money is the relief for every person who are suffering. Money can remove all the distresses. That’s why the requirements of the money have increased in the financing market. Money isn’t spreading on the ground so you pick up the money and solve all the problems. Money is earned by hard working. On the other hand if you need urgent cash then Cash Money Loans can assist you any time when you need of urgent money. Cash Money Loans are availed through internet where there are many lenders available to assist you any time. The lenders try to easy of your tedious way so that you might avail Cash Money Loans easily without any problem. Duration of procuring the Cash Money Loans your age must be at least 18 years or above, your monthly income must be at least $1000 or more and you must have an active checking account at least 6 months old in valid bank. The cash will be deposited in your bank account within few hours. Cash Money Loans are the quota of payday loans which have made against borrower’s property. There are many loan agencies lend money when the borrowers want to take money according this they pay the asset the lenders but Cash Money Loans doesn’t have any requirement as to place the collateral or co-signer so Cash Money Loans is very familiar among the people in the market. Apply for Cash Money Loans, first of all you are to fill up an online application form and submit it, and rest of the work will be completed by the lenders, the cash will be wired in your account within few hours. The following day you will meet a perfect amount.

You can make a plan to seek for job. Duration of seeking for job emergencies can occur on the middle way then you can remove all the emergencies easily, and keep on your task. When unanticipated expenses become faddish, and they fatigue the persons who are suffering from defaults, arrears, CCJ’s, etc. due to worst credit record they don’t apply for cash and nor many financial institutions want to lend money the bad credit history borrowers, and then you are agree to avail loan at high interest. In that condition Cash Money Loans are available everywhere 24/7. Cash Money Loans is availed without checking credit history of the borrowers. You can avail Cash Money Loans within few hours through internet. You have got many options to use Cash Money Loans that you can vary your bad credit to good credit by paying off your last debt and other like pay the medical bill, pay the electric bill, unexpected car repair or travel, decorated home on any festival, spend the money on your child’s birthday party, pay the college fee, etc. after removing all these problems, you live life hassle free in future. The repayment process is very shortage because of unsecured loans; you can repay Cash Money Loans amount within 20 days. If you don’t repay Cash Money Loans amount within 20 days, the interest rate will be increased so you should repay the Cash Money Loans amount timely. The interest rate of Cash Money Loans is a bit higher than other loans because these types’ loans are the short amount loans from $50 to $1500.

articlesbases.com

The Types of Hard Money Loans

This article will explain the basic concept of Hard Money Loans, i think it's should be useful for newbie... just like me... :D

Are you familiar with the term Hard Money?

Hard money is money loaned to you by private investors, these private investors can be from anywhere but normally the hard money lenders would want to work within their own state, so if you're from california than you want to find an investor in california.

So what type of hard money loans the hard money lenders will do?

The first type of hard money loans lenders are offering is construction hard money loan.
In construction hard money loan the hard money lender will loan the borrower the money in stages, example:You own a land in los angeles california, on that land you want to build a house, you have the plans approved by the city of los angeles and you're all ready to go, now you need a hard money loan because it will be easier to qualify and get the money you need for the construction, You will call a hard money lender and give your information, the approved plans, your financials, your budgets for the construction(you can get it from your contractor), then lets say the hard money lender agrees to loan you the money you need, but the way the hard money lender will Loan you the money is by stages, and the stages are:

When your Contractor will finish the foundation, the contractor will get paid after inspection that is done by the hard money lender $10,000 for the foundation work, Than when your electrician finishes the electricity in the house, than the electrician will get paid after inspection done by the hard money lender another $7000.

You understand the concept?
Everybody by the completion of the construction will get paid by the hard money lender.

Why the hard money lender do that?
Because he want to have control of the money, private investors know the risks they're taking but they're still willing to take these risks only if they have 100% control of the money.

Why hard money lender will choose to Loan money to investors and not homeowners?

This is a very good question that a lot of people should know the answer for.
The hard money lenders wouldn't want to have to take a homeowner out from his home because he didn't make the payments, but with investors it's different, it's 100% business and that's what the hard money lenders want- Business.

What type of properties hard money lenders will loan money on?
A hard money lender will loan money to many type of properties: single family residents, condos, townhouses, apartment buildings, hotels, motels, office buildings, shopping centers and many others.

What hard money lenders don't like, it's land. It will be very hard to find a hard money lender that will loan you money on a land, and the reason is because there is no income to lands, maybe you can get a hard money loan on a golf course or maybe a land that you about to develop something on, but raw land- forget about it.

Today hard money lenders loan more money to commercial real estate investors rather then to residential investors and the reason is less risk.
Today the residential market is not going up, values of homes are actually going down by more than 30%, and every day more foreclosures are coming out on the market, so the hard money lenders are smart enough not to participate in taking risks with homeowners.

Commercial real estate is still very competitive, investors are still buying properties, remodel properties and build new properties.
The commercial real estate market is still alive just like it was in the residential market 3 years ago, and hard money lenders are still in the game, and now they're busy more than ever because the banks don't loan money that easy to borrowers.
So it's commercial properties rather than residential properties, and construction Loans.
Good luck