Los Angeles Hard Money Lending Companies say there are many reasons borrowers decide to use hard money lenders instead of banks. The main reasons are that hard money lenders are able to present fast approvals and financing and can provide loans to individuals who have now already been refused by conventional lenders.
The following is an expanded list of some of the reasons borrowers decide to use Los Angeles Hard Money Lenders instead of a bank:
The borrower demands the capital fast to near an escrow
Los Angeles Hard Money Lenders are able to invest in very quickly, especially when compared to conventional lenders. For an investment property, a direct hard money lender is able to invest in in a matter of days.
Funding for owner occupied property takes 23 weeks due to the current federal regulations that all lenders must follow along.
The borrower has a recently available foreclosure on their record
A foreclosure in the past couple years is typically a red flag for a conventional lender. In addition, Los Angeles Hard Money Lenders are able to overlook these sorts of issues as extending the hard money borrower is otherwise financially powerful.
The borrower has a new quick sale in their record
Los Angeles Hard Money Lenders are not too focused on small sales. Banks generally involve the borrower to wait two years after a quick sale to qualify them for a loan.
The borrower has recently been discharged by a bankruptcy
As soon as the borrower has discharged their bankruptcy a Los Angeles Hard Money Lender can think about supplying a loan to them.
The ownership of the property is certainly going to be a hope, LLC, corporation, non-profit or other thing it really is a lot more complicated to get a loan by a bank when the borrower will be an entity.
Skilled hard money lenders are able to make the hard money loan into the thing and then have an individual assume the loan or provide a personal guarantee.
Funding directly to an entity is especially beneficial for people who need to borrow against real estate at a probate, estate or trust.
The borrower is employed or doesn’t have sufficient time inside his/her current employment
Conventional lenders have rigorous income history conditions and usually involve the borrower to have at least two years of employment with their current company.
On the other hand, Los Angeles Hard Money Lenders are able to use other documentation to qualify a borrower for an operator busy hard money loan such as tax statements, W2s or pay stubs.
The borrower doesn’t have the amount of reservations necessary by the bank
Los Angeles Hard Money Lenders usually do not typically have special publication requirements.
The hard money borrower will just need to have sufficient income/cash available to carry the holding prices of the property for example monthly mortgage payments, taxes, insurance and maintenance.
The borrower wants a simplified qualification procedure
The application method for a bank loan can take 45 days or more and consist of completing stacks of paperwork. Hard money loans often just demand a very simple application and loan approvals can be given the same day the application is acquired.
The borrower owns also too many expense properties.
Banks usually have arbitrary constraints of 4 loans each borrower. Past this limit the borrower will be refused additional financing.
Los Angeles Hard Money Lenders have no type of limitations and are happy to provide funding for as many investment property loans as the borrower requirements.