Why Choose A Commercial Hard Money Loan Over A Traditional Bank Loan
Oct 05, 2016
All money is not built the same. If you are ready to make your next real-estate investment, you are probably assessing the pros and cons of each loan type: commercial hard money loan vs. traditional bank loan. While both of them provide you with liquidity to complete your real-estate transaction, they are not interchangeable.
What Are Commercial Hard Money Loans?
A commercial hard money loan is a loan that is directed specifically for real-estate investment purposes. They are granted by private lenders and directly transferred to the business owner who is in need of fast money for their next venture. This type of loan is asset-based, the assets being the value of your property. When doing business, timing plays a great role into seizing the next opportunity. Hence, getting fast and secure money as soon as you identify an opportunity is critical for the future thriving of your business.
Mortgage Loans & Business
Banks play by longer-term rules. In order to get a mortgage loan, any borrower will have to go through strenuous financial background check: credit score report, how long you have been in the business, etc. This definitely makes the approval process an uphill battle. Thus, it means a protracted process and this does not really fit the timeframe of any real-estate investor who wants to seize opportunities as they come their way.
The Advantages Of Commercial Hard Money Loans
Commercial hard money loans, on the contrary, come with a much less strenuous background check than the traditional loan process. You do not need to have a stellar credit score in order to get approved. Actually, borrowers who have mediocre credit scores or bankruptcy history can still apply for hard money loans. Getting approved is tied to the value of the property you put as collateral; it has to be worth at least 30 percent of the property value. As a result, this type of loan has a much faster closing process than traditional loans. You will be able to get to business more quickly rather than spending time at the table with bankers.
Looking For Fast Money To Complete Your Real Estate Investment?
Commercial hard money loans are definitely what you need and Riverdale Funding is here to assist you. We are the commercial lender that can give you the stability and the terms that you need in order to maximize your ability to do business. We operate in 35 States across the United States and grant hard money loans from $250,000 up to $5 million+. Give us a call right now at 888-368-4983 or fill this contact form!