Are you looking for a loan option but not sure if you can qualify? Maybe hard money loans are an option for you. many people have used them when other kinds of loans weren’t available. Below are three benefits of hard money loans that you may not know about.
Since a lender will focus on collateral value, these types of loans often close faster when compared with a traditional loan. They often don’t review your bank statement, income sources and other things, so things go quicker.
These kinds of agreements often are more flexible with compared with other types of loans. Based on the situation you’re in, it’s possible you can tweak loan features like your repayment schedule. It’s also possible that an individual will loan you money rather than global institutions.
The biggest thing with this kind of loan is your collateral. Even though the approval for this type of loan might be fast and simple, the majority of lenders will keep their LTV ratios somewhat low. The max ratio will be between 65% – 75%. Therefore, it’s necessary to have assets so that you qualify for these types of loans. Because the ratios are conservative, a lender knows they’ll be able to sell the property rather fast and recoup their money.
These are three benefits of choosing hard money loans. If you are looking for a loan option beyond the typical types of loans, choosing a hard money loan might be the best choice for your needs.