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Financial institutions and private lenders are some of the options at your disposal whenever you are faced with money problems that forces you to borrow. Instead of going to the usual financial institutions for financing, you can avoid all the trouble and inconvenience if you choose to borrow from hard money lenders. If you have never borrowed from hard money lenders, there are several advantages you are missing out on. On that note, the following are some of the incredible benefits of hard money loans.
When you are applying for a hard money loan, their chief interest is the collateral you are offering; once it is determined its value exceeds the value of the loan plus interest, you immediately qualify for the loan. Why wait for several weeks to qualify for a loan from a bank when you can get the same amount within a day or so if you opt for a hard money loan whose qualification is dependent on the value of your collateral with high approval proves.
The biggest reason why most people don’t apply or qualify for loans from traditional lending institutions is poor credit but this is not a problem with hard money loans; only the value of the collateral you are offering matters. When you apply for a hard money loan, the lender will consider your loan-to-value ratio and in case you fail to keep your part of the bargain the property can be sold to recover the loan plus interest.
You will enjoy freedom and flexibility with hard money loans that you will rarely enjoy when dealing with conventional loans; you are limited on one loan from a hard money lender provided you can provide another collateral, you can work out new terms with the lender. A collateral that you can claim at least twenty percent liquidity on is all you need to qualify for a hard money loan; income and financial history and other documents are not needed here.
Clearing a bank loan earlier than initially agreed can be expensive on your part due to the penalties they impose for doing so but hard money loans have no prepayment penalties involved. Considering delays in approval are minimal and funding is quicker, hard money loans are the perfect financial opportunity to help you avoid missing out on investment opportunities. Discussed above are advantages associated with hard money loans.
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