Private Money Loans

Speed: Get a private money loan in as little as 24 hours.

Credit: Loans are asset-based, not credit-based

Fees: Avoid early repayment fees

Growth: Grow your portfolio fast

Private Money

Lending Overview

Private money loans are asset-based financing that use the value of property to determine the loan terms, rather than relying on the borrower’s credit score. These loans have many uses, including buying equipment, upgrading a property and generating a capital infusion. However, they’re most frequently used to buy real estate property. Investors often prefer private money loans because they’re easier to get than traditional financing through a bank. Approval times are just a fraction of what they are with traditional loans, sometimes as little as 24 hours. That’s because private money loans come from private investors and investment groups. These investors don’t scrutinize your credit report and tax return information. Instead, they’re focused on the value of the property you’re using to secure the loan. For these reasons, private money loans are favored by borrowers with trouble in their credit history and experienced investors who want to close deals quickly. To learn what private money loans can do for you, consult with your broker.

The Funding Lane

How to Effectively Apply Funds

There are several ways private money loans can effectively benefit your business. They’re especially useful when time is a factor. Since they can be approved quickly, private money loans help you close on investment deals much faster than with a conventional mortgage. Professional rehabbers like private money loans because they make cash offers possible, securing real estate fast in competitive markets. Because private money loans are a form of short-term financing, real estate investors can pay them off once the property is sold. Private money lenders are willing to take more risk, because they’re often investors themselves.

Real Estate

Make your next real estate deal stand out with a cash offer when you utilize a private money loan. Approvals are quick and easy. Loans depend on the value of the property, not on your credit score. Ask your broker how hard money lenders can help you grow your real estate investment portfolio fast..

EQUIPMENT

Private money loans are asset-based, which means you can use them to buy new equipment or leverage your existing equipment to accelerate cash flow. Why wait to improve safety and productivity in your workplace when you can get the equipment you want now? Speak with your broker about a private lender for equipment today.

Working Capital

When you need a cash boost for new hires, new projects, or new expenses, leverage your business assets to secure a private money loan. Apply the cash anywhere you need it without being locked into a long-term obligation. Find out more about private money loans by speaking with a qualified broker.

FINANCING REAL ESTATE WITH PRIVATE MONEY LOANS

When considering a private money loan for real estate investments, understanding the down payment requirements is crucial. Unlike traditional bank loans that often have strict down payment percentages, private money lenders offer more flexible terms. This flexibility can be particularly beneficial for real estate investors looking to leverage multiple properties or those with limited cash on hand. The down payment on a private money loan typically varies depending on the lender’s assessment of the deal’s risk and the property’s value. A real estate investor should discuss these terms directly with their private money lender to optimize their financial strategy and ensure they can meet the upfront costs without overextending their resources. This approach allows investors to swiftly secure funding and capitalize on market opportunities with minimal delay.

BENEFITS OF A HARD MONEY LOAN

Hard money lending, often used interchangeably with private money loans, presents a multitude of advantages for real estate investors seeking quick, reliable funding solutions. This type of financing is particularly valuable for investors who need to act swiftly in competitive markets. Unlike traditional bank loans, hard money loans prioritize the value of the property over the borrower’s credit score, enabling faster approval processes—often within 24 hours. This speed is crucial for investors looking to secure properties at auctions or to outbid competitors on high-demand real estate. Additionally, hard money lending is flexible with terms and repayment schedules, which can be tailored to fit the unique timelines and financial strategies of real estate projects. For many real estate investors, the ability to obtain rapid, asset-based financing without the encumbrance of traditional credit requirements makes hard money loans an indispensable tool in their investment arsenal.

HOW TO SECURE A PRIVATE MONEY LOAN

Securing a private money loan is a streamlined process that primarily focuses on the value of the property rather than the borrower’s credit score. To start, potential borrowers should prepare a detailed proposal showcasing the property’s worth and their planned use of the funds. This proposal should include a current appraisal and, if possible, a strategy for increasing the property’s value. Unlike traditional lenders, private money lenders assess the loan’s viability based on the property’s potential and the investment’s risk level, not the borrower’s financial history. This approach means that down payment requirements can be quite flexible. They often vary depending on the project’s perceived risk and the lender’s relationship with the borrower. A higher-risk project might necessitate a larger down payment to balance the lender’s increased exposure. Conversely, a project with substantial equity and a clear path to profitability might require a smaller down payment. By understanding these nuances, borrowers can effectively negotiate terms that align with their financial strategies and investment goals.

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FAQ’s

We believe that the more you know, the better the decisions you make. And in the financing world, better decisions mean lower rates, better terms, and increased profitability.

These FAQs are only the start. Our team is here to answer all of your questions and support you in finding the best financing solution for your unique scenario.

Q. What are the risks of a private money loan?
Private money loans are short-term loans. That means you’ll need to plan ahead to pay them back on time. Typically, you’ll pay only interest on the loan until the term has ended. Then, you’ll be required to pay the balance in full. This could be a problem if you’re unprepared to pay off or refinance the loan.
Q. What are private money lenders?
Private money lenders are generally investors or investment groups that specialize in private money loans. Many traditional lenders don’t offer private money loans, so it’s best to ask a broker if you want this type of loan. They can match you with private lenders who are experts in your market.
Q. Will private money loans affect my credit?
Private money lenders don’t report to personal credit bureaus, which means that getting a private money loan won’t hurt your personal credit. However, these loans will show up on background and asset searches. However, if you fail to pay the loan and the lender turns to a collection agency, this could hurt your credit score.
Q. Is a private money loan tax deductible?
You may be able to deduct interest payments on the loan as a business expense. However, it’s best to consult with a tax professional to find out exactly what you can deduct.
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Get Funded

The funding process starts with a short 3 minute online application. Our team will then review your needs and quickly provide you with a custom funding proposal that targets your desired financing types, rates, and terms.