Tuesday, 21 February 2012

Hard Money Lenders

Hard Money Lenders are lending companies offering a specialized type of real-estate loan which must be backed. Hard money lenders provide short-term loans that provide funding based on the value of real estate that has been collateralized for the loan. Hard money lenders typically have much higher interest rates than banks because they fund deals that do not conform to bank standards.
There are different types of hard money loans:   
·         Mortgage Refinancing:

refinance pays off one or more loans secured to the property, which results in a new loan, generally with a bigger principal balance. A homeowner can refinance without receiving any of the proceeds by either rolling the costs of the new loan into the principal balance or paying the costs of the loan out of the borrower's pocket.

·         Equity Loans 

Home equity loans fund fairly quickly and are subordinate to an existing first mortgage. In other words, an equity loan falls into second or third position. Borrowers cannot obtain a home equity loan in all 50 states.

·         Bridge Loans 

Bridge loans are used by sellers who want to buy a new home before selling an existing home but need the cash from the existing home. You will see bridge loans used more often in seller's markets than in buyer's markets.

Hard money lenders can turn quite a profit when they invest their money in short-term ventures that reap much higher interest rates than standard investments. The concept in general can be volatile in nature, but ultimately, when one weighs the pros and cons of issues hard money loans, they will get a better idea of how the various aspects of the industry can benefit them financially and contrast the risks they must take along the way. To help you navigate these choppy financial waters, we’re going to outline all of the benefits, all of the drawbacks, and of course, show you how, when handled properly; hard money lending can rapidly compound your finances.

California Hard MoneyLending is just as popular as it is in most areas, particularly with property buyers. You might wonder why credit seekers would likely decide on private hard money lenders over traditional loan associations. You may often hear or read that private funders demand extra or that they are known to be last option for funding.

The truth is that California Hard Money Lenders offers many services that the banks cannot or will not. They approved more loans, in a timelier manner. They understand th needs of the investor, since most of them have invested in the real estate.
Finally, you do not need to limit yourself to hard money lending in California, specifically. For many years, most private financiers only operated in small regions, so that they could drive to the property if they wanted and take a look around.

California Hard Money Lenders