What Are Hard Money Loans?
Secured by real property, better known as collateral, hard money loans are short-term loan options often seen as a ‘last resort’ by investors. Don’t let this scare you away – hard money loans are an excellent way to purchase a new property when you know and understand everything about them. Hard money loans are very short-term, roughly lasting one year, and for that reason, interest rates are high (usually around 9-15%). Hard Money Lenders look over-rules and regulations that financial institutions will scrutinize you for, such as bad credit or a blemished buying/renting history. This is because hard money lenders know you will have a property as collateral, and if payments aren’t made, the collateral will be sold so the lender can get their money back. You must have a solid repayment plan when you take out a hard money loan, or your project might flop.
Private Money Loans In The Inland Empire, CA
Private money loans are a type of hard money loan lent privately from a lender to an investor. They are normally used to purchase a new property or invest in a commercial property. These types of loans are much like hard money loans – they are short-term, last roughly a year, have high-interest rates, and use the real property as collateral. Serving Inland Empire and surrounding Los Angeles metropolitans, RTI Bridge Loans is a Private Money Lender that can provide you with funding for your next real estate endeavor. Now is the perfect time to invest – expect to see a large influx of people moving to The Inland Empire as the market continues to boom. Contact RTI Bridge Loans today for more information about your big move.
Fix And Flip Loans In The Inland Empire, CA
With a lower population than many of the major cities surrounding Los Angeles, The Inland Empire is still exactly how it sounds, an empire that’s growing rapidly. This makes the perfect area to invest in fix and flip projects. What exactly are Fix and Flip Loans? Lenders provide investors with fix and flip loans when investors want to buy a property, renovate it, and then sell it for a high profit. The real estate market in California is growing so fast that fix and flip projects have begun expanding to surrounding areas outside of Los Angeles, such as The Inland Empire. These short term loans supply an investor with enough time to fix a property and sell it, and when the property is sold, the loan is paid back in full.
Hard Money Loans In The Inland Empire, CA
Finding a Hard Money Loan in the greater Los Angeles area as well as surrounding cities is relatively easy, but you want to make sure you’re heading in the right direction. RTI Bridge Loans supplies every Hard Money Loan Type that you might need, including bridge loans, private money loans, fix and flip loans, commercial property loans, and much more. You want to make sure you’re working with the right hard money lender when you’re ready to finance your next project. RTI supplies hard money loans that are short-term, and interest rates will vary depending on the collateral property. Contact RTI Bridge Loans serving The Inland Empire for your hard money loan needs today.
The Best Advantages Of Hard Money Loans
There are so many reasons why people find hard money loans attractive, especially in California, where business and real estate is booming. Hard Money Loans are an easy and fast way to borrow money from a professional lender and finance a new home or a fix and flip project. Let’s take a look at the top reasons why people love hard money loans.
- They are extremely fast. Compared to traditional bank loans, hard money loans are truly a speedy way to get cold hard cash. Financial institution loans or mortgages can take months and have tons of hurdles that you need to jump in order to finish the process. With hard money lenders, you can have cash in your pocket in as little as 3-5 days.
- Hard money lenders won’t judge you based on your credit history or blemishes on your rental/homeownership past. In fact, sometimes they don’t even look at that information at all. Hard money lenders are only concerned with the equity you have in a property, or the property you will be using as collateral. If you fail to repay, the lender can easily sell the collateral property and make their money back.
- Hard money lenders fund projects that banks will most likely turn down. If you go to the bank trying to get a loan or a mortgage for a Fix and Flip project, the answer will more than likely be a firm ‘no’. Hard money lenders see fix and flip projects, for example, as an amazing way for you both to make a great profit, and will most likely fund your fix and flip endeavor.
Disadvantages Of Hard Money Loans
Unfortunately, there are a few reasons why people find hard money loans unattractive and refuse to invest using one. It is a risky business; don’t get me wrong. You need to know exactly what you’re getting into and have a solid repayment plan, or things will go awry for both you and the lender. Here are the top reasons why people stay away from hard money loans.
- The interest rates are high. Since these are very short-term loans, naturally, interest rates will be higher. Usually, they sit from around 9-15%, and monthly payments are normally interest-only. Interest rates are also high due to the risk.
- It’s all around risky for both you and the lender, and hard money loans are considered ‘last resort’. Simply put, it is a bit nerve-wracking to use hard money loans, especially if you don’t have a strong repayment plan. It’s easy to fall short on loan payments, and if you can’t make payments, you will most likely lose the collateral property – the lender will have to sell it in order to make their money back.
- They are short term, so stay away if you need longer than a year for your project. Hard money loans are usually ranging from about six months to one year, and some lenders will go up to two years, depending on your project type.
Different Types Of Hard Money Loans
Depending on the type of project you are looking into, there’s probably a hard money loan for your situation. Whether you are looking at purchasing a rental property, a new home, a commercial property – the sky really is the limit when it comes to borrowing a hard money loan (as well as way fewer restrictions). Let’s take a look at the most popular Hard Money Loan types.
A type of hard money loans, bridge loans do exactly what they sound like they do – they bridge a gap between selling an old home and buying a new one. They are great for people who have a home on the market that hasn’t sold, but they are trying to move into a new place.
Fix And Flip Loans:
Highly popular in California, Fix and Flip project loans are meant for buying a new property, renovating it, then selling it for a high profit. These loans usually last one year – enough time for an investor to fix up the property and sell it.
Commercial Property Loans:
Also very popular in the dense Los Angeles community are commercial property Hard Money Loans. These types of loans are great for people who are ready to own their own commercial property and rent it out – the loan term gives investors enough time to fix up the property and begin renting it out to business people.
Private Money Loans:
Private Money Loans are a type of hard money loan, given for multiple reasons to an investor by a hard money lender. They are usually used for purchasing a new property, a commercial property, or for fix and flip projects. They are also short-term, along with the other Hard Money Loan types, lasting roughly six months to one year.
Contact RTI Bridge Loans in Inland Empire, CA at (310) 532-5008 for any questions or concerns you may have regarding the limitations of hard money loans.