What You May Not Know About Commercial Hard Money Loans | Riverdale Funding

What You May Not Know About Commercial Hard Money Loans

Nov 16, 2016


There tends to be a lot of confusion as to what hard money loans really are. This article will delve a bit deeper to help clear up any misconceptions and explain what a commercial hard money lender can do for you.

In elementary terms, a hard money loan is any loan that has a tangible asset as its collateral. Hard money loans are sometimes called “bridge loans,” “private loans,” “short-term loans” and “no-document” or “no-doc” loans. In effect, hard money loans are secured loans, and commercial hard money loans are backed by the borrower’s commercial property. Hard money loans differ from traditional loans in that factors like the borrower’s income and credit history are not considered in the approval process.

Approval is issued much faster as well; hard money loans can be approved in 24 to 48 hours and sometimes within minutes, while traditional loans can take up to 90 days for the bank to make their decision. There is very little paperwork involved in the hard money lending process and fewer “hoops” to jump through, so to speak. While traditional lenders approve loans based upon the borrower’s income, credit score, past tax returns and other documents, a commercial hard money lender bases their decision solely upon the value of the collateral property.


Who Applies for a Commercial Hard Money Loan?

A hard money loan provides a short-term financing option (usually one to three years) for those who would otherwise be turned down by a bank or traditional lender.

Persons facing an imminent financial situation and don’t have time to wait for a traditional loan can benefit greatly from this type of loan. Owners of industrial properties, retail properties, 5-family or larger units, and one to 4-family non-owner occupied properties owned by a corporation or LLC can all qualify. The application process for a hard money loan requires the submission of a recent photo of the collateral property in addition to a short loan application.


Commercial hard money loan features include:

• Loan amounts up to 65% of collateral property value
• One to three-year terms
• Competitive interest rates and fees


Riverdale Funding Offers Hard Money Loans

Whether you’re a real estate investor or a business owner looking for short-term financing, a hard money loan can be the solution. Call Riverdale Funding at 888-368-4983 or apply online for more information today.