Commercial banks in the US had granted 15.5 trillion-dollar in loans till June 2021. Even this massive amount is not enough to cater to the robust US economy. As a result, people turn to private hard money lenders. Individuals who have a below-average credit score are likely to be rejected by a bank on their loan application, and that’s why they turn to private hard money lenders. Here are three things you need to consider before selecting a private hard money lender.
Experience And Reputation
Trust is one of the most critical factors in any transaction in the private lending industry. When you are dealing with banks, you can trust them since they have established a name for themselves in the industry. The same concept should be followed when you are selecting a private hard money lender. You must ensure that the hard money lender you choose is rich in experience in this industry and has a reputation for striking excellent deals for its clients.
When you’re taking out a loan, the first thing that you must be worried about is the interest rate that you will be charged. The higher the interest rates, the greater the cost of borrowing. You should choose the hard money lender who adjusts interest rates according to the assets you have. While the US banks give out loans at 4%, interest rates given by hard money lenders are between 10-15%, known to be reasonable rates in today’s market.
Average Time Taken to Respond
You would choose a private money lender if you are in a financial crisis and need to get out of it quickly or your bank loan has been rejected. In both circumstances, you need financial backing quickly.
The response time for a private money lender would make or break a deal. If a private money lender takes weeks to analyze your application, then that firm is useless for you. A good response time for any lender is 24 hours after you have submitted your application. The quicker the application approval, the faster you will get your loan.
If you’re looking for a private lender to sort out your financing issues, visit Commercial Private Equity now. We want to make hard money loans easily accessible to you. We have been providing hard money loans for over 75 years, and we use your assets to dictate the terms of any loan agreement. We provide many types of loans, including commercial hard money loans, construction loans, real estate loans, and many more specialized loans.
Contact us now for more information.