How Hard Money Lenders Can Help You During COVID-19
Even with all the reopening of cities across the United States, some households may find themselves stuck trying to get out of the setbacks caused by COVID-19. If you are in this category, you may be considering all the different options to get a little extra cash now, especially when it comes to real estate matters. Have you thought about what a hard money lender could do for you?
What are hard money loans?
Hard money loans are a form of asset-based financing. The funds a borrower receives are guaranteed by the equity value of a property. Interest rates are higher on hard money loans compared to loans guaranteed by a financial institution. These types of loans are financed by private entities that are guaranteed by promissory notes to private investors.
It works the same way as any other loan. You continue to make monthly principal and interest payments on the amount you borrow. It will have a repayment term that you must meet, like any traditional loan.
Facts about hard money loans
Here are some of the traits that are indicative of hard money loans:
These loans are protected by brokers
Residential and business loans
The terms can vary from 11 months to 5 years.
1S t, 2North Dakotaand 3rd position in all properties
No cash withdrawal restrictions
Past bankruptcies, short sales, and foreclosures are okay
Amortized and interest-only programs
loans can be approved within six to 24 hours
Get approved for the loan
This type of loan requires that you have equity in a property. Once a lender analyzes the equity in the property, the normal loan process will begin. The amount you will borrow will be determined by your principal amount, ability to pay, debt ratio, and your long-term goals with the property.
Your lender should advise you on all the details of the deal, such as interest rate, prepayment penalty, terms, cost, title issues, among other important loan details.
Check with a local lender to see what your options are and how a hard money loan can help you with your COVID-19 problems.
How a big money loan can help in times of COVID-19
If you have home equity, you may be able to use it to get a loan. During COVID-19, mostly when it was at its peak, you may have had trouble handling all of your bills. If you are having difficulty obtaining a loan and need extra cash to survive this pandemic, you may want to explore loans and see if you qualify.