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fidelityfunding · 4 years

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Tор 3 Disadvantages оf Hаrd Mоnеу Loans California

Whіlе the ѕрееd, low rеԛuіrеmеntѕ and flexibility оf hаrd mоnеу lоаnѕ еnѕurеѕ rеаl estate іnvеѕtоrѕ hаvе thе саріtаl thеу nееd tо соmрlеtе thеіr projects, thеrе аrе ѕоmе aspects оf Hard Money Loans that саn be considered lеѕѕ thаn іdеаl. 1. Hаrd Money Lоаn Interest Rates Arе Higher Thаn Bаnk Loans Hаrd mоnеу loan іntеrеѕt rаtеѕ аrе аlwауѕ gоіng tо be hіghеr thаn a conventional bаnk loan. Thе higher іntеrеѕt rаtе іѕ duе tо thе increased rіѕk for the lеndеr and thе соnvеnіеnсе to thе borrower оf hаvіng іmmеdіаtе ассеѕѕ to саріtаl. Intеrеѕt rates fоr hаrd mоnеу loans are generally gоіng tо rаngе frоm 6-15% dереndіng оn various factors. Hаrd money lеndеrѕ also charge a lоаn origination fee whісh аrе called роіntѕ, a реrсеntаgе оf the loan аmоunt. Pоіntѕ uѕuаllу range from 2-4 аlthоugh thеrе аrе lеndеrѕ who wіll charge muсh hіghеr points fоr specific ѕіtuаtіоnѕ. Cеrtаіn аrеаѕ of the соuntrу have many соmреtіng hаrd mоnеу lеndеrѕ while оthеr аrеаѕ hаvе few. As wіth аnуthіng еlѕе, competition brіngѕ рrісеѕ dоwn. In lаrgе metropolitan аrеаѕ there аrе uѕuаllу mаnу more hard mоnеу lenders wіllіng tо lend than іn more remote rural аrеаѕ. Bоrrоwеrѕ саn benefit grеаtlу from checking rаtеѕ аt a fеw dіffеrеnt lenders bеfоrе соmmіttіng tо a hard mоnеу lеndеr. Whіlе nоt аll hаrd mоnеу lеndеrѕ оffеr 2nd mortgages оr trust deeds on рrореrtіеѕ, the ones who dо сhаrgе a hіghеr іntеrеѕt rаtе on 2nds thаn on 1sts. Intеrеѕt rates оn 2nds аrе uѕuаllу 2-3% hіghеr thаn fоr 1sts. Thіѕ іnсrеаѕеd interest rаtе rеflесtѕ thе increased rіѕk for the lender bеіng іn 2nd роѕіtіоn rаthеr thаn 1ѕt. If thе borrower goes into dеfаult, thе 1st lіеn hоldеr саn foreclose оn thе рrореrtу and wіре оut thе 2nd lіеn hоldеr’ѕ іntеrеѕt іn thе рrореrtу. 2. Hаrd Money Lоаnѕ Arе Fоr Shоrt Term Uѕе Onlу Most hard mоnеу lоаnѕ аrе wrіttеn for 1-2 уеаrѕ. Longer tеrmѕ оf 3-5 years are аvаіlаblе but that іѕ gеnеrаllу thе uрреr lіmіt fоr lоаn tеrm lеngth. Thе lоngеr the lоаn term thе mоrе risk thе lеndеr is tаkіng оn since іt is unknоwn where interest rates will mоvе tо bу thе end of thе tеrm. If interest rаtеѕ drор, thе bоrrоwеr has thе option оf rеfіnаnсіng tо thе lоwеr current rаtеѕ. If thе іntеrеѕt rаtеѕ increase, thе bоrrоwеr іѕ able tо kеер thеіr lower іntеrеѕt rate lоаn аnd lеndеr іѕ forced tо wаіt until thе lоаn becomes duе. While thе lеndеr іѕ waiting fоr the loan tо bесоmе duе, thеіr іnvеѕtmеnt in thе truѕt dееd іѕ yielding less than whаt thеу could receive for a nеw truѕt dееd investment аt current rаtеѕ. This represents a risk tо thе lеndеr and encourages thеm to offer оnlу ѕhоrtеr tеrmѕ. Bаnkѕ dеаl with іntеrеѕt rаtе unсеrtаіntу bу оffеrіng lоwеr іntеrеѕt rates fоr ѕhоrtеr tеrmѕ and hіghеr іntеrеѕt rаtеѕ fоr lоngеr tеrmѕ. Fоr еxаmрlе, a 30 year fully amortized lоаn іѕ gоіng tо hаvе a muсh hіghеr іntеrеѕt rate thаn thе 15 уеаr fully amortized lоаn. 3. Hаrd Money Lоаnѕ Rеԛuіrе A Dоwn Pауmеnt Or Equity Of At Least 25-30% Sоmе borrowers vіеw dоwn payments оr еԛuіtу rеԛuіrеmеntѕ as a detriment thаt рrеvеntѕ them frоm obtaining a loan. Hard mоnеу lеndеrѕ аrе аblе to look раѕt mаnу issues and ѕhоrtсоmіngѕ, but only because thеу аrе requiring ѕuffісіеnt еԛuіtу іn thе рrореrtу tо act аѕ security fоr thе lоаn. “Hаrd mоnеу” uѕеѕ thе “hard” аѕѕеt tо ѕесurе the lоаn, while bаnkѕ fосuѕ рrіmаrіlу оn іnсоmе, a clean credit rероrt and FICO ѕсоrеѕ. Wіth hаrd mоnеу, nо down payment еԛuаlѕ nо lоаn. Without a ѕuffісіеnt dоwn payment оr еԛuіtу thе hard mоnеу lеndеr іѕ еѕѕеntіаllу taking on all thе risk. If thе borrower оnlу рutѕ down a 5% dоwn рауmеnt аnd receives a loan fоr thе rеmаіnіng 95%, a 10% drop in thе рrореrtу vаluе wоuld рut the bоrrоwеr аt a 5% lоѕѕ on the property. If the bоrrоwеr thоught thе dесlіnе wоuld соntіnuе оr thе рrореrtу vаluе wоuld nоt increase in value in thе nеаr futurе, thе borrower wоuld hаvе lіttlе incentive to соmрlеtе thе рrоjесt and mау аbаndоn it, dеfаult оn the Hard Money Loan and leave it tо the lender tо clean uр thе mess. This is a wоrѕt саѕе ѕсеnаrіо for thе hаrd money lеndеr. In a ѕіmіlаr scenario where thе bоrrоwеr рutѕ іn a 30% dоwn рауmеnt (instead оf оnlу 5%), a 10% dесlіnе іn thе vаluе of the property still gіvеѕ the borrower рlеntу оf іnсеntіvе tо stick wіth the рrореrtу and рrоjесt to рrоtесt their equity. Cоmmеrсіаl hаrd mоnеу lоаnѕ оftеn hаvе a larger minimum dоwn рауmеnt rеԛuіrеmеnt оf 40%. Thе larger dоwn payment rеԛuіrеmеnt rеflесtѕ the increased difficulty іn selling a commercial рrореrtу, аѕ thеrе аrе fаr fеwеr buyers for commercial рrореrtіеѕ соmраrеd tо rеѕіdеntіаl properties. If a bоrrоwеr dеfаultѕ оn a соmmеrсіаl Hard Money Loan and the рrореrtу іѕ tаkеn bасk bу thе hard mоnеу lеndеr, thе ѕаlе рrісе may hаvе to be discounted ѕіgnіfісаntlу ѕо thе lеndеr саn rесоuр their investment with a ԛuісk sale. Cоmmеrсіаl properties are аlѕо mоrе difficult to vаluе as thеrе are fewer dаtа points to work wіth when соmраrеd tо rеѕіdеntіаl. Fidelity Funding Wants to Work with You! Fidelity Funding proudly offers a wide range of loan products capable of suiting the needs of virtually every borrower. Contact us today for more information about how Fidelity Funding can fund a hard money loan that works for you!

Fidelity Funding Helps You With Hard Money Loans

Fidelity Funding | Hard Money Loans Email: [email protected] Phone: (877) 300-3007 Website: https://www.fidelityfundingcorp.com Read the full article

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fidelityfunding · 4 years

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How Long Does It Take To Close A Hard Money Loan

Borrowers frequently rely on tough money lending institutions when in the requirement of fast and versatile financing options. In lots of circumstances, a quick Hard Money Loan might be the only way to rapidly protect the purchase of a residential or commercial property or pull eԛuity from a piece of property. Tough money lending institutions comprehend they require to supply a fast closing to allow their customers to accomplish their present objective. The length of time does a hard cash loan require to close? The answer will depend upon the type of tough money loan required, the circumstances of the loan, and the borrower’s current position in the loan process. This post will talk about numerous difficult money loan types and the length of time it takes to close each loan in a perfect circumstance. Typical issues that extend the time to close will likewise be noted. Prior to entering into the specifics of timing on closing, a fast word about tough cash loan approvals. How long is required for a difficult cash loan approval? Depending on the specific circumstance, the tough money loan reԛuest can be authorized within 5 minutes or it might take several days for more complicated loan circumstances. Generally, the hard cash loan provider requires to ԛuickly check out the subject home and conduct a quick evaluation of the customer's application. To accelerate the approval procedure the debtor should complete the difficult cash loan application with as much appropriate detail as possible and submit any files reԛuested by the loan provider as ԛuickly as possible. Once the loan reԛuest has been authorized the hard money lending institution can continue with the loan. The time frames discussed in this short article for closing a loan are basic guidelines that can vary substantially depending on the actual loan provider and the customer's circumstances. Non-Consumer Hard Money Loans – Close in a couple of days Non-consumer (frequently described as a business function) tough money loans can be moneyed the fastest as they have the fewest quantity of guidelines. If escrow is currently open and a preliminary report has actually been prepared the loan can be funded within 2-3 days. If escrow requires to be opened and a preliminary report requires to be prepared it will likely take around 5-6 days to money the loan. Non-consumer loans will have the very same financing timeline whether the property being used as collateral is a financial investment home or a primary house. Making use of the obtained funds is among the elements to identify if the loan is thought about a non-consumer or consumer loan. The other element is the ownership of the home. A customer that is an entity is usually not going to be thought about a consumer loan. The type of realty utilized as security is unimportant in the decision of a non-consumer vs consumer purpose loan. It is possible that a loan against a commercial workplace building could be for a customer function while a loan against an owner-occupied primary home might be a non-consumer (or business purpose) loan. Consumer Function Hard Cash Loans – Close in as few as 10 days Consumer purpose loans can not be closed as quickly as non-consumer Hard Money Loans due to the different government regulations. The primary step is to offer the customers with the Loan Price quote file. After 7 company days, the Closing Disclosure can then be offered to the borrower. After another 3 business days, the final loan documents can be signed. * If the home being utilized as security for the loan is currently owner inhabited, there will be an additional 3-day waiting duration after the loan documents are signed. Consumer purpose loan decision: The bulk of the funds loaned to an individual are intended to be utilized for personal, personal, or family purposes. Factors and situations which extend the time to close – Preliminary report – If a preliminary report has not yet been purchased it might take a couple of days for the title company to prepare. Prospective delay: 2-3 days – Title issues – An initial report that returns with any prior uninsured transfers will reԛuire effort and time from the title business to make sure the present owner of the home is able to encumber or transfer the property. Possible delay: 2-30+ days - Clearing any liens or judgments – The discovery of any unknown liens or judgments can seriously postpone closing or even prevent the loan from closing at all. Liens and judgments will need to be settled so the difficult cash loan can be recorded in the preferred position. Possible hold-up: 1-30+ days - Evidence of Insurance – Evidence of insurance for the home is essential to close the loan. Possible delay: 1-2 days - Pay off demand - If the subject home has existing loans that are being paid off with the new Hard Money Loan, settle need requests must be sent and received back from the lender prior to closing the loan. Potential delay: 1-5 days Fidelity Funding Wants to Work with You! Fidelity Funding proudly offers a wide range of loan products capable of suiting the needs of virtually every borrower. Contact us today for more information about how Fidelity Funding can fund a hard money loan that works for you!

Fidelity Funding Helps You With Hard Money Loans

Fidelity Funding | Hard Money Loans Email: [email protected] Phone: (877) 300-3007 Website: https://www.fidelityfundingcorp.com Read the full article

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fidelityfunding · 4 years

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Need Money ASAP? 7 Situations Where Hard Money Loans Can Help Can Help

While Hard Money Loans can be somewhat unknown to the average consumer, they often are even less well understood. Hard Money Loans come in a variety of forms and typically offer a higher degree of flexibility and a larger number of options that conventional bank loans. Here's a closer look at just some of areas in which Hard Money Loans can help.

Seven Ways Hard Money Loans Can Help

1. Hard Money Loans on Almost Any Property Type Unlike banks and other lenders that are beholden to strict rules about what types of loans can be made with regards to certain properties, Hard Money Lenders often are freer to lend on a wide range of properties and to work with borrowers to accommodate unique circumstances. At Fidelity Funding, we pride ourselves on working with prospective borrowers to arrange loans on almost every property type, commercial or residential. 2. Bridge Loans The flexibility of Hard Money Loans makes them particularly effective as bridge loans. Just like their name sounds, bridge loans are short-term loans that "bridge" the gap by providing much-needed short-term financing. For example, if a potential borrower is eager to close the purchase of a property but is having difficulty arranging complex, long-term financing with a bank or other conventional lender, a hard money bridge loan could provide the funds necessary to complete the purchase in the immediate term while the giving the borrower time to close the deal on longer-term financing. 3. Fix & Flip Loans The flexibility of Hard Money Loans also makes them uniquely well-suited as so-called "Fix & Flip" loans. While the stringent lending criteria of banks and other conventional lenders oftentimes can make it difficult for them to make loans on "fixer-uppers," we understand the house-flipping business and are able to gauge for ourselves the potential in often-overlooked properties. The ability of Hard Money Lenders to make short-term loans on properties that do not meet the lending requirements of banks makes them particularly well-situated to act as fix & flip loans. 4. Emergency Loans Because they have more flexibility in working with borrowers to make sometimes unconventional loans, Hard Money Lenders also can be a good source of emergency financing. Hard Money Lenders are able to bypass much of the regulatory red tape that bogs down conventional lenders, meaning that even if one is able to qualify for a conventional loan, the money often does not arrive soon enough. At Fidelity Funding, we pride ourselves on working with the speed and flexibility our borrowers need when meeting their emergency financing needs. 5. Second and Third Mortgages Hard Money Loans also can be taken out as second or third mortgages in situations where conventional lenders may not allow. This can be particularly important in situations where one possesses equity in a property but is in need of immediate short-term liquidity. Additionally, Hard Money Loans secured by second and third mortgages can be arranged for a wide variety of reasons, durations, and on both commercial and residential properties. Even if one has a first mortgage held by a conventional lender, a hard money loan might be a good choice for a second mortgage, should one ever need to convert hard-earned equity into liquidity. 6. Loans on Unconventional Properties The strict rules imposed on conventional lenders like banks means that they are unable to make loans on many unconventional properties that do not fall within narrow parameters. This potentially leaves many property owners with nowhere to turn when in need of financing, though they may be creditworthy and/or possessing equity in their property. Thankfully, Hard Money Lenders are not beholden to the same stringent lending requirements, allowing them to make loans on many properties on which conventional lenders cannot or will not lend. 7. Loans for Those with Past Credit Problems Unlike many conventional lenders, Hard Money Lenders are free to look beyond a potential borrower's credit score in considering their loan application. Significantly, Hard Money Lenders often will place greater weight on the value of the underlying property and the resulting loan-to-value ratio than to a borrowers' supposed "creditworthiness" in making lending decisions. This can be of huge benefit to borrowers who, oftentimes through no fault of their own, may have encountered credit problems in their past–whether it be due to student loan debt, medical bills from a serious ailment, the failure of a previous business, or any number of other reasons–but still may own property with equity in it.

Two Benefits Of Hard Money Loans

Hard Money Loans can be of benefit in a wide variety of situations that don't necessarily comply with the strict, narrow requirements of convention lenders and conventional loans. Hard Money Lenders are able to look at each borrower's unique circumstances in determining what kind of hard money loan would be best for his or her personal situation and, in many instances, are able to provide funding where conventional lenders cannot. 1. Hard Money Loans Are Not One Size Fits All Hard Money Loans come in a variety of forms, with different rates and durations suited to the borrowers' unique circumstances. In this way, Hard Money Lenders are more free to make loans that fit their borrowers' needs, rather than borrowers having to contort themselves to suit the particular needs of a lending institution. We understand how hard and frustrating it can be trying to fit a square peg in a round hole, as often is required with conventional lenders, and so we pride ourselves on offering Hard Money Loans specifically fitted to our borrowers' needs. 2. Hard Money Loans Are an Important Source of Credit for Those Turned Down by Traditional Lenders Hard Money Loans fill an important role in the financial system by providing borrowers with the flexibility and speed that conventional loans oftentimes cannot. Further, Hard Money Loans are available to many borrowers who may have encountered credit difficulties in the past. Because Hard Money Lenders look at factors beyond the credit score–factors like loan-to-value ratio–they are able to offer loans to many borrowers who would be denied by conventional lenders. Fidelity Funding Wants to Work with You! Fidelity Funding proudly offers a wide range of loan products capable of suiting the needs of virtually every borrower. Contact us today for more information about how Fidelity Funding can make a hard money loan that works for you!

Fidelity Funding Helps You With Hard Money Loans

Fidelity Funding | Hard Money Loans Email: [email protected] Phone: (877) 300-3007 Website: https://www.fidelityfundingcorp.com Read the full article

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fidelityfunding · 4 years

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Do Hard Money Lenders Check Credit? 5 FAQs About Getting Approved for a Loan

When you are looking for a short-term investment loan that can be secured by a property, Hard Money Lenders offer an attractive option. They can have a quick turnaround time from application to funding and are useful for a wide range of investment scenarios. Keep reading to learn more about what Hard Money Loans are, when it makes sense to seek one and how to go about applying.

What Is a Hard Money Loan?

A hard money loan is a type of loan that is usually secured by real property. You can often get funding from Hard Money Lenders quickly, sometimes in just days. This incredibly quick turnaround time is a huge advantage over bank funding, especially in cash-only or short sale situations. Hard Money Loans often have rates that are slightly higher than conventional loans, and there may be fees that you are unfamiliar with. Lending restriction may be different, too. For example, documentation requirements may be more lenient, while the loan to value ratios may be stricter. This isn't to say that Hard Money Loans are necessarily more expensive or a bad idea in the long term. You should just be aware that the features and processes are different than those associated with obtaining a conventional mortgage. Hard Money Loans can be a great way to make a property purchase in certain situations, despite the many myths around them.

Will Hard Money Lenders Check Credit? 5 FAQ About Getting Approved for a Loan

If you have considered applying for a hard money loan, you may be wondering what the application process involves. Contrary to popular belief, Hard Money Loans are not a guaranteed prospect. You will need to qualify to get funding. Here are five common questions about applying and getting approved for a hard money loan. 1. What Documentation Is Required? There is a widespread misconception that hard money and no-doc loans are the same things. They are not. While they are both considered non-conventional loan options, there are important differences between them. Hard Money Loans are property loans that are funded through private investment. They offer a short turnaround time from application to funding and are a popular option for short term funding needs. However, you will need to provide documentation of your income, employment history, and creditworthiness when you apply. Most Hard Money Lenders will also want to see appraisals or other documentation for the property in question. This is very different from a no- or low-doc loan, that is made with little supporting documentation. Relaxed requirements make these popular options for self-employed workers or those with a spotty credit or job history. 2. Are There Strict Rules with Hard Money Loans? The truth is that no matter where you borrow money from, there will be some rules, regulations, and restrictions. These help keep the processes of applying, lending, and repayment ordered and moving along smoothly. Hard money does not have any more rules than any other type of conventional loan, and, in many cases, the rules are slightly more relaxed. When you take out a hard money loan, you are working with private investors. This gives you an opportunity to discuss what goals you are looking to achieve and see if a set of rules and arrangements can be worked out to benefit everyone involved. Many lenders will be receptive to policies that will help you repay your loan, so slightly nontraditional rules may be more attractive to them than they would to a bank. Keep things sensible, though, and don't expect a lender to agree to ridiculous or unprofitable terms. They are businesspeople, after all, and they are lending money as an investment they want to see a healthy return on. 3. What Loan to Ratio Loans Get Approved? Hard Money Loans are not a good vehicle to fund the entire purchase of a property. That gives the lender little reason to invest since there is no security cushion. So, if you are planning to use hard money to fund the entire purchase and renovation of an investment property, you should probably rethink your strategy. Funding 100% of purchase and renovation would mean your lender is taking on more risk for your project. Many private lenders (hard money or otherwise) are going to require a down payment before discussing terms. Most Hard Money Lenders may want to see a loan to value ratio at about 70% or less. You may find one or two willing to let that go as high as 80%, or perhaps even a touch higher if your creditworthiness is very strong. Even though they want to see some equity, many lenders are willing to fund construction or remodeling expenses on investment properties if you do have a down payment in hand. 4. Is There Anything Else Lenders Will Want To See? Lenders are going to want to verify your ability to pay back their investment. After all, they are not in the real estate business directly, and they would rather not take possession of the property securing your loan. As a result, they are going to want to see a strong credit score and history. They are also going to want to know what your exit strategy for the investment is. If you are wondering what that is, you need to do some more research before you seek funding. An exit strategy is basically how you plan to repay the money you are borrowing. Some options investors may consider sound are flipping a property by making improvements and selling it or turning it into an income-producing rental property. You'll also need to provide values for the property as it is, and estimated values for once repairs and renovations are completed. You should know the estimated costs for any work you are planning to have done or will be performing yourself. If you are planning to invest in rental properties, you should be able to provide an estimate of rents for similar units in the area. 5. When Does It Make Sense to Seek This Type of Funding? Hard Money Loans can make sense in a variety of situations that don't lend themselves to traditional bank financing. Some of the most common ones include investment properties that are going to be resold quickly or as short-term bridge loans for construction and renovations.

Is Hard Money Right for You?

If you want to learn more about financing options, including Hard Money Loans, contact Fidelity Funding. They offer simplified application processes and a fast turnaround to meet your needs.

Fidelity Funding Helps You With Hard Money Loans

Fidelity Funding | Hard Money Loans Email: [email protected] Phone: (877) 300-3007 Website: https://www.fidelityfundingcorp.com Read the full article

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fidelityfunding · 4 years

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4 Reasons to Talk to the Best Hard Money Lenders in California

If you're looking for a loan in the state of California, there are a large number of reasons why a hard money loan might be the perfect solution for you. Hard Money Lenders in California are able to operate with a degree of flexibility unavailable to conventional lenders, like banks, who must comply with a wide range of restrictions that do not apply to Hard Money Lenders. Here are just a few reasons why you should reach out to a hard money lender in California today to discuss your personal or business financing needs.

1. Fidelity Funding Looks Beyond the Credit Score

One important benefit Hard Money Lenders have over conventional lenders is their ability to look beyond the credit score to consider other aspects of a potential borrower's situation. For example, Hard Money Lenders typically place a greater emphasis on the loan-to-value ratio of the collateral property than a potential borrower's credit score. This makes Hard Money Loans an ideal solution for potential borrowers who may have encountered credit problems in their past–oftentimes due to circumstances beyond their control–but who may possess equity in their property. Loan-to-Value Ratio What is the loan-to-value ratio? It is a tool that Hard Money Lenders use to gauge the amount of equity remaining in property and, by consequence, how risky a given loan would be. For example, if a potential borrower owns a property worth $100,000, but that property has a $50,000 mortgage on it, the loan-to-value ratio would be calculated by dividing the $50,000 outstanding mortgage balance by the $100,000 property value, for a loan-to-value ration of 50%. The Higher the Loan-to-Value Ratio, the Greater the Risk to the Lender The higher the loan-to-value ratio (LTV), the greater the risk to the lender, as a higher LTV translates into less of an equity cushion should the property value decline during the life of the loan. However, this emphasis on LTV over mere credit score means that Hard Money Lenders in California can make loans to many potential borrowers who would be turned away by conventional lenders, even though those potential borrowers may possess considerable equity in their property.

2. We Offer a Wide Range of Loan Types

Hard Money Lenders also strive to meet borrowers' needs by offering a wide variety of loan types, with a much broader range of options than can be provided by the typical conventional lender. For example, we offer short-term bridge loans, fix & flip loans, second and third mortgages, construction loans, and more. Because we are better able to consider all aspects of a potential borrower's situation, including a borrower's specific plans for a given property, we are able to offer loans in situations where conventional lenders cannot. We Offer More Than Just Cookie-Cutter Loans Our greater flexibility allows us to offer more than the usual cookie-cutter, one-size-fits-all lending options available through conventional lenders like banks. In fact, Hard Money Lenders often make bridge loans specifically intended to cover the gap while otherwise qualified borrowers go through the onerous process of securing longer-term, conventional financing with a major financial institution. Similarly, we are able to offer second and third mortgages on properties that we consider to have sufficient equity, where conventional lenders would decline to do so.

3. We Lend on a Range of Unconventional Properties

One of the major ways in which Hard Money Lenders are able to offer significantly more flexibility than conventional lenders is through their ability to lend on a wide range of properties that might not fit within the strict, narrow requirements under which conventional lenders operate. Hard Money Lenders in California make loans on both residential and commercial properties, as well as some owner-occupied properties. Credible Hard Money Lenders Don't Just Check Boxes, They Look at Underlying Factors By looking at underlying factors such as loan-to-value ratio and cash flow, Hard Money Lenders are able to see value and opportunity where more narrowly-focused conventional lenders do not. This can be of enormous benefit to potential borrowers who own or wish to secure financing on properties that do not fit the cookie-cutter standards of conventional lenders, or whose businesses may not perfectly fit the models those lenders prefer.

4. We Want to Work with You

Too often, with conventional lenders like banks, borrowers are made to feel less like the valued customers they are and more like a beggar in search of a handout. Because Hard Money Lenders are able to search out opportunities where conventional lenders are not, we are accustomed to really getting to know our borrowers, their goals and ambitions, their businesses, and their properties, which allows us to provide lending products uniquely tailored to their particular circumstances. Where conventional lenders might see too much risk due to uncertainty or a non-standard type of property, we look for an opportunity with the motto that we are trying to find ways to accommodate potential borrowers rather than reasons to reject them.

Fidelity Funding: The Best Hard Money Lenders in California

If you have attempted to obtain a loan through a conventional lender but have been left with nothing but headaches for your efforts, Hard Money Lenders in California are your next best option. We stand ready to assist you in developing a loan that works for your individual situation. Where conventional borrowers look for reasons to say no, we look for reasons to say yes, taking into account the totality of a borrower's circumstances, not just one or two numbers that could never tell the whole story of a person or a business. We Work Hand-in-Hand with Our Borrowers As Hard Money Lenders in California, we work hand-in-hand with our borrowers to truly understand their lives, businesses, and properties, allowing us to see opportunities that others overlook and giving our borrowers the opportunity to thrive where others have denied them that chance simply because they did not fit the narrow criteria spelled out on a boilerplate loan application. Contact Us Today! At Fidelity Funding, we stand ready to help fulfill your financing needs to the best of our abilities by offering loan products uniquely tailored to you. Contact us today to see how we can provide you with the financing you need to achieve your life and business goals! Hard Money Loans are short-term loans that are typically secured by real estate. They can be used by investors to fix and flip property purchases (purchase and renovation of properties). Typically, an investor will purchase, renovate, and sell a property in less than a year. Hard Money Loans for flipping houses are excellent options for fix and flip projects since they enable the financing of properties that are in less than ideal condition.

What Is a Hard Money Lender?

Hard Money Lenders are individuals or private companies who lend money to investors with real estate as the primary collateral. Since, unlike banks, they are not regulated, property and borrower qualifications are more relaxed. Fix and flip investors find Hard Money Loans work well for the financing, renovation, and sale of a property. They can also be used for refinancing. How Hard Money Loans for Flipping Houses Work Hard Money Loans are sometimes called rehab loans. The qualifications for attaining them are lower and more flexible than traditional loans. The property and the potential profit it can turn are more relevant to lenders than a borrower's background. Approval is generally quick. Hard money loan mortgages are intended to be short-term and interest-only. Hard Money Loan Rates, Terms & Qualifications Hard Money Loans differ greatly from traditional mortgages in a few key ways: The qualifications are more lenient Interest rates are higher Loan times are shorter Funding times are shorter They can be used to finance distressed properties, single-family homes, apartment buildings, condominiums, etc. Loans are made based on a property's loan to value ratio/after repair value ratio or loan to cost. After repair value is the expected fair market value of a property, originally underpriced after it has been renovated. Hard Money Loans are typically up to 75 to 80 percent of a property's anticipated after repair value. At Fidelity Funding, we can offer up to 90 percent on loan to cost. As with traditional bank loans, investors should expect to cover closing costs, application fees, appraisal fees, and other associated expenses that come with the purchase of a property.

Flip Investors

Most fix and flip investors aim to renovate and sell properties within three months to a year of acquisition. There is an expectation from the lender the property will be flipped, and the loan will be honored within a year when the property sells. Although the rates on Hard Money Loans for flipping houses are higher, funding is fast enough for investors to compete with cash buyers. Fix and flip investors prefer Hard Money Loans because they both finance the purchase and renovation of investment homes. Such investors target houses in poor condition that, when renovated, will potentially sell for more than their market value. Short-sales, foreclosure auctions, and lender-owned REO properties are commonly financed as flip and flip projects. Hard Money Loans for flip and fix projects are generally equal to a percentage of the property's expected fair market value after renovations have been made. Once a property is purchased, investors begin renovations, taking money for repairs in the form of stipends or “draws” arranged as a line of credit by the lender. The need to float rehab costs between stipends is common. Long-Term Investors Long-term investors look to finance and renovate properties as well. Where they differ from fix and flip investors is they aim to season properties before moving to refinance to a permanent mortgage. For long-term investors, the principal debt is paid when new long term financing is obtained. Long-term investors typically purchase properties in poor condition. They aim to renovate the property and then rent it to tenants. Long-term investors who seek Hard Money Loans often cannot qualify for a conventional loan. Typical underwriting may present problems for borrowers who are considered credit risks because of judgments, tax liens, or other issues.

Why Hard Money Loans Are Appealing to Investors

Hard Money Loans for flipping houses are popular with investors. They often prefer to attain a short term loan with quick pre-qualifications, and rapid funding time frames and interest-only payments. The potential of quick turnover makes the expense of the loan a palatable trade-off. Investors focused on attaining Hard Money Loans like they can finance the purchase of single-family or multi-unit properties. The ability to be competitive in a fast-paced sales market is essential. The rapid approval and funding time of Hard Money Loans makes them ideal for purchasing short-sales, REOs, and foreclosure properties. No matter the timeline an investor has, Hard Money Loans are used for the same purpose, property purchase, and renovation. During the loan period, monthly payments are generally interest-only. Prepayment penalties are rarely a factor, so the loans can be paid off early if desired.

The Bottom Line of Hard Money Loans

At the end of the day, Hard Money Loans for flipping houses are a useful tool for short-term fix and flip investors. The ability for Hard Money Lenders to offer shorter processing times for approval and interest-only payments to those wishing to purchase and renovate investment properties is highly beneficial to borrowers. At Fidelity Funding, we are able to offer rates that are competitive to prime buyers. Investors can be pre-qualified within just minutes, and we can have you funded within five to seven days. Our criteria for investors is straight forward and hassle-free: No minimum credit score No income or credit verification No Tax returns required Two to three months' worth of banking statements The location and purchase price of the investment property Contractor bids and rehab scope No mortgage insurance Fidelity Funding specializes in providing loans to almost every type of property, both residential and commercial. We are able to fund first, second, or third trust deeds and the provision of home equity lines of credit. If you are a new or seasoned flip and fix investor who needs a reliable lender for Hard Money Loans for flipping houses, contact us today to discuss your loan needs! We look forward to partnering with you on your next investment project.

Fidelity Funding Helps You With Hard Money Loans

Fidelity Funding | Hard Money Loans Email: [email protected] Phone: (877) 300-3007 Website: https://www.fidelityfundingcorp.com Read the full article

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How to Find Hard Money Direct Lenders You Can Trust

Though Hard Money Direct Lenders are relatively little known and even less well understood as compared to traditional lending institutions such as banks, they play a crucial role in our financial system. However, one of the biggest hurdles facing potential borrowers who may be interested in a hard money loan is how to find a hard money direct lender they can trust. To help, we'll go through some of the simple steps any potential borrower can take to find a trustworthy, hard money direct lender.

Look for Hard Money Direct Lenders Who Know Your Area

Because Hard Money Direct Lenders are not beholden to the same strict underwriting criteria as applies to traditional lenders such as chartered banks, they have much more flexibility in making loans where other lenders say no. For example, Hard Money Direct Lenders are able to lend on a range of unconventional properties that may not meet the stringent standards of a bank. Freedom from these strict, oftentimes government-mandated lending requirements means that Hard Money Direct Lenders have greater flexibility in judging each loan application on its own merits. This means that Hard Money Direct Lenders are able to use their own knowledge and experience with regard to certain geographic areas, specific property types, or a particular business or industry in gauging the strengths and risks of a potential loan. Knowing the Area Means Seeing Opportunities Others Do Not This is where an in-depth feel for the local real estate market, population, and economy can truly set one hard money direct lender apart from another. Hard Money Direct Lenders who possess detailed knowledge of the areas in which they lend–including local trends, tastes, and needs–have the ability to see opportunity where others do not, allowing them to extend credit in instances where another lender may turn down a potential borrower. A hard money direct lender with a strong knowledge of the areas in which it lends also can serve as a more effective partner, helping to gauge changing trends and prepare for potential challenges. In short, finding a hard money direct lender, you can trust means first finding one who knows and understands the ins and outs of your geographic area and local real estate market.

Look for Hard Money Direct Lenders Who Know Your Business

When looking for a commercial loan, it also is of the utmost importance to find a hard money direct lender who understands your business or industry. As with Hard Money Direct Lenders with intricate knowledge of a local community, lenders who understand your business or industry will be able to see opportunities where others do not and will be able to better work with you to address challenges specific to your area of work. Knowing Your Industry Means Understanding Challenges and Opportunities Lenders with less knowledge of a particular business or industry will be less able to engage as a trusted partner in both embracing opportunities and avoiding potential pitfalls. Such lenders might grow needlessly concerned with conditions that do not neatly "check the boxes" mandated by conventional lenders or with up-and-down cycles that are normal to the particular industry. In short, finding a hard money direct lender that you can trust means finding one who understands your individual situation, and that means a lender who has a familiarity with your particular business or industry. Otherwise, when opportunities for expansion arise or one is in need of some help to make it through unforeseen tough times, one may be stuck with a hard money direct lender who does not understand the opportunities presented to them or how to help a borrower overcome certain challenges.

Look for Hard Money Direct Lenders Who Treat You Like a Valued Partner

One can learn a lot about how Hard Money Direct Lenders think of their borrowers just by the way borrowers and potential borrowers are treated. When looking for a lender you can trust, it is vital that you look for one who treats its borrowers as valued business partners and cherished customers rather than an annoyance or inconvenience that must be dealt with on their way to profit. At Fidelity Funding, Our Borrowers Are Our Business Partners Unfortunately, some Hard Money Direct Lenders act as though their investors–rather than their borrowers–are their primary customers. At Fidelity Funding, we believe the reverse is true. Our borrowers are the core of our business, and we take pride in working with our borrowers to help them achieve success. Because what we understand –and what frankly seems to be lost on many other Hard Money Direct Lenders–is that when our borrowers succeed, we succeed. Therefore, we embody the principle that our borrowers' success is equivalent to our own success, and we bring that philosophy into every interaction we have with our highly appreciated borrowers, without which there can be no us.

Look for Hard Money Direct Lenders Who Know Your Success Equals Their Success

This brings us to our final tip for finding a hard money lender you can trust. It cannot be overstated that any trustworthy hard money direct lender will understand that its success hinges directly on the success of its borrowers and will, therefore, do everything within its power and abilities to help ensure the success of its borrowers. Too often, short-sighted lenders treat borrowers as something less than essential to their lending business. At Fidelity Funding, we believe that this approach could not be more wrongheaded! We pride ourselves on working with our borrowers, taking the time to know their properties, businesses, and financial needs, because we know that in order for us to succeed, our borrowers must succeed, too.

Fidelity Funding: A Hard Money Direct Lender You Can Trust

We know that sorting through the endless amounts of information available online often can only add to the confusion when it comes to finding a hard money direct lender that you can trust. That's why we hope that these tips will help you narrow the field, identifying lenders that will treat you as a valued partner and not an annoyance. At Fidelity Funding, we remember that our borrowers' businesses and properties represent years of hard work, ambition, and planning, and we continually strive to earn their trust. We are honored that our borrowers have placed their faith in us to act as trusted partners in reaching their goals. Contact us today to see what we can do for you!

Fidelity Funding Helps You With Hard Money Loans

Fidelity Funding | Hard Money Loans Email: [email protected] Phone: (877) 300-3007 Website: https://www.fidelityfundingcorp.com Read the full article

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fidelityfunding · 4 years

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4 Keys to Finding Hard Money Loans in Los Angeles

When looking for a hard money loan in the Los Angeles area, it can be difficult to know where to start. How does one find a lender, and how does one know if that lender is the right choice for you? To help simplify the process, we put together our keys to finding Hard Money Loans in Los Angeles.

4 Keys to Finding Hard Money Loans in Los Angeles

There are many different strategies when it comes to finding a hard money loan. Some people prefer to ask around and find potential lenders via word of mouth. Others perform a simple online search. Still, others might check with a third-party organization, such as the Better Business Bureau. Whatever strategy you choose, here are some keys to finding a loan: Key 1: Find the Right Loan, Not Just Any Loan When searching for a hard money loan, it is important to keep in mind that you are not looking for just any loan or for the first loan that comes around. You are looking for the right loan for you. This can be one of the most difficult parts about finding a loan, and it often requires patience on the potential borrower's part. Sometimes, after searching long and hard for financing, a potential borrower will be willing to settle for whatever offer they can find. However, in many instances, a bad loan can leave you worse off than no loan at all. That's why our first key to finding a hard money loan is to make sure you find the right loan for you and your situation. What Does It Mean to Find the "Right" Loan? Before even beginning your search for a potential lender, you should determine exactly what kind of loan you are looking for. You can start by answering some of the following questions: Will you be relying on your income or collateral (or both) when seeking approval for the loan? What kind of property do you have to use as collateral for the loan? How much equity is in the collateral property? What is the purpose of the loan? Exactly how much money do you need? What sort of monthly payment can you afford? How long would you like the repayment period to be? What would be your plan if you are unable to make the monthly payment? Answering these questions will help you to better understand what loan terms would fit your needs and which ones would not. It is important to take out enough money for your purposes but also not to take out so much money that it might become a challenge to make the monthly payments. Again, sometimes a bad loan can leave you worse off than no loan at all, so don't get caught in a situation that does not work for you. Key 2: Find the Right Lender Now that you're armed with information about what kind of a loan you are looking for, you can begin your lender search. Finding the right lender is just as important finding the right loan because the same loan on paper can be become a vastly different experience in reality based on who your lender is. Fidelity Funding understands the important role the lender plays over the life of a given loan, which is why we are proud to have earned an A+ rating from the Better Business Bureau. Key 3: Find a Lender Who Wants to Work With You At Fidelity Funding, we know that our borrowers are the core of our business and that if our borrowers don't succeed, we don't succeed. Unfortunately, in the race to make as many loans as possible as quickly as possible, too many leaders lose sight of this basic fact about our business. That's why in finding the right hard money lender, it is very important to find a lender who wants to work with you: who wants to understand your goals and tailor a loan to your needs rather than just their own. We treat our borrowers like the business partners that they are, and you should make sure to find a lender who does the same. Key 4: Find a Lender Who Understands the Local Area One reason that potential borrowers seek out Hard Money Loans is that their situation does not fit the cookie-cutter, check-the-boxes approach that conventional lenders like banks often take when it comes to loan approvals. Because Hard Money Lenders have greater flexibility to examine applicants, their businesses, and their properties on a case-by-case basis to make their own determination, they are able to make loans where other lenders would deny the application. However, being able to see these "diamonds in the rough" means that, if a hard money lender is to serve as an effective business partner, they must have a deep knowledge of the local area in which their borrowers live and/or operate. Without a detailed understanding of local real estate at the neighborhood level or of local industries and business trends, a lender is ill-equipped to gauge a good opportunity from a bad one and is less able to provide guidance or understanding when challenges arise.

Keep the Keys In Mind

These are just four keys to finding Hard Money Loans in Los Angeles, but, of course, this is by no means an exhaustive list of considerations you should keep in mind while securing the financing you need. One of the big advantages that Hard Money Lenders offer over traditional lending institutions like banks is greater flexibility in making unconventional loans that don't necessarily fit into strict categorical definitions. However, this greater flexibility also places greater responsibility on Hard Money Lenders to use their own judgment in gauging the prospects of a loan application. That's why your choice of the lender can be even more important when it comes to Hard Money Loans than with a conventional bank loan. We know the importance of choosing the right lender. Contact Fidelity Funding today to see what we can do for you!

Fidelity Funding Helps You With Hard Money Loans

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Hard Money Loans for Flipping Houses: Can It Really Work?

Hard Money Loans are short-term loans that are typically secured by real estate. They can be used by investors to fix and flip property purchases (purchase and renovation of properties). Typically, an investor will purchase, renovate, and sell a property in less than a year. Hard Money Loans for flipping houses are excellent options for fix and flip projects since they enable the financing of properties that are in less than ideal condition.

What Is a Hard Money Lender?

Hard Money Lenders are individuals or private companies who lend money to investors with real estate as the primary collateral. Since, unlike banks, they are not regulated, property and borrower qualifications are more relaxed. Fix and flip investors find Hard Money Loans work well for the financing, renovation, and sale of a property. They can also be used for refinancing. How Hard Money Loans for Flipping Houses Work Hard Money Loans are sometimes called rehab loans. The qualifications for attaining them are lower and more flexible than traditional loans. The property and the potential profit it can turn are more relevant to lenders than a borrower's background. Approval is generally quick. Hard money loan mortgages are intended to be short-term and interest-only. Hard Money Loan Rates, Terms & Qualifications Hard Money Loans differ greatly from traditional mortgages in a few key ways: The qualifications are more lenientInterest rates are higherLoan times are shorterFunding times are shorter They can be used to finance distressed properties, single-family homes, apartment buildings, condominiums, etc. Loans are made based on a property's loan to value ratio/after repair value ratio or loan to cost. After repair value is the expected fair market value of a property, originally underpriced, after it has been renovated. Hard Money Loans are typically up to 75 to 80 percent of a property's anticipated after repair value. At Fidelity Funding, we can offer up to 90 percent on loan to cost. As with traditional bank loans, investors should expect to cover closing costs, application fees, appraisal fees, and other associated expenses that come with the purchase of a property.

Flip Investors

Why Hard Money Loans Are Appealing to Investors

The Bottom Line of Hard Money Loans

At the end of the day, Hard Money Loans for flipping houses are a useful tool for short-term fix and flip investors. The ability for Hard Money Lenders to offer shorter processing times for approval and interest-only payments to those wishing to purchase and renovate investment properties is highly beneficial to borrowers. At Fidelity Funding, we are able to offer rates that are competitive to prime buyers. Investors can be pre-qualified within just minutes, and we can have you funded within five to seven days. Our criteria for investors is straight forward and hassle-free: No minimum credit score No income or credit verification No Tax returns required Two to three months' worth of banking statements The location and purchase price of the investment property Contractor bids and rehab scope No mortgage insurance Fidelity Funding specializes in providing loans to almost every type of property, both residential and commercial. We are able to fund first, second, or third trust deeds and the provision of home equity lines of credit. If you are a new or seasoned flip and fix investor who needs a reliable lender for Hard Money Loans for flipping houses, contacts us today to discuss your loan needs! We look forward to partnering with you on your next investment project.

Fidelity Funding Helps You With Hard Money Loans

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fidelityfunding · 4 years

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How Can You Get a No Income Verification Loan?

When you're applying for a loan from a bank or other traditional lender, one of the first things they'll ask for is a verification of income. Not only that, but verification of income will likely be one of the biggest factors they'll consider. If you are unable to verify an income stream that meets their stringent standards, not only for the amount but for consistency and reliability, you are unlikely to get the money you need. If this sounds like you, you should consider a No Income Verification Loan from Fidelity Funding. What Is a No Income Verification Loan? Not all lenders view income verification as so crucial a factor in gauging a potential borrower's suitability for a loan. In fact, some lenders do not require income verification at all, instead looking to other factors, such as the equity in the collateral property. Where can one find such a loan? Hard Money Lenders Unlike traditional lenders like banks, which are limited by strict lending requirements, Hard Money Lenders have much more freedom to operate, considering a variety of factors in making their own determinations about the opportunity presented by a given borrower. This allows Hard Money Lenders to offer loans that ignore completely a potential borrower's stated income and instead rely on other factors.

What Factors Do Hard Money Lenders Consider?

Obviously, no lender is just going to hand away money to any person who comes through the door asking for it. But Hard Money Lenders are able to look at a variety of factors in determining whether or not to approve a given loan. If you are wondering whether you potentially would qualify, consider these factors: Factor 1: Loan-to-Value Ratio One key factor that Hard Money Lenders will look at when evaluating a loan application is the equity available in the collateral property. Many No Income Verification Loans are secured by property, known as collateral. The amount of equity in the collateral property is often measured in terms of the so-called loan-to-value ratio, or LTV. The LTV is calculated by dividing the amount of debt secured by the property by the property's fair market value. How to Calculate Loan-to-Value Ratio Calculating the loan-to-value ratio, or LTV, involves fairly simple mathematics. For example, to use round numbers, imagine that a potential borrower owns a property worth $100,000. If that potential borrower owns the property "free and clear," that is, unencumbered by any debt, then the loan-to-value ratio is zero divided by $100,000, which, of course, is 0%. Now, say that same property owner wanted to borrow $50,000 secured by that property. If the property owner were to add a $50,000 mortgage to the property, then the loan-to-value ratio would be $50,000 divided by $100,000, or a 50% LTV. Next, let's pretend that after the property owner took out that $50,000 first mortgage, he or she wanted to take out a second mortgage in the amount of $25,000. Then, the loan-to-value ratio would be calculated by adding the $50,000 first mortgage to the $25,000 second mortgage, for a total of $75,000. Dividing that sum by the $100,000 gives the fair market value of the underlying property. In this instance, the LTV would be 75%. Why Does Loan-to-Value Ratio Matter? Loan-to-value ratio matters to Hard Money Lenders because it is a shorthand way for them to gauge the amount of risk involved in making the loan. In essence, the loan-to-value ratio shows how much cushion a lender has in the event of a decline in the value of the collateral property. To see why, let's return to the above example, pretending that our property owner has been successful in obtaining both the first and second mortgages. The property now is encumbered by a $50,000 first mortgage and a $25,000 second mortgage. Now, let's say that a downturn occurs in the local real estate market and, combined with some problems that occurred at the property itself, the fair market value of that property drops to only $60,000. This means that while the full $50,000 of the first mortgage is covered, only $10,000 out of the $25,000 second mortgage now is, meaning that the holder of the second mortgage potentially stands to take a significant loss. To better understand why this is, let's take a look at our second factor. Factor 2: Senior Debt When considering an application for a loan to be secured by collateral property, a lender will consider any senior debt existing on the property. The so-called seniority of given debt plays a significant role in the amount of risk a lender is assuming when making a loan. This is because, in the event of default, more senior debts have the first right to any proceeds generated from the sale of the collateral property. That is why, in our above example, if the property value declined to $60,000, the holder of the first mortgage would still stand to be paid in full on its $50,000 balance and the holder of the second mortgage would receive only $10,000.

Conclusion: Best Ways to Qualify

When considering a loan application without verifying income, a lender will look to other means for measuring the risk of a potential loan, such as the amount of equity available in the collateral property. Therefore, the best way to qualify for such a loan is to consider other ways that you can give the potential lender confidence that they have the best chance possible to recover fully on the loan should unforeseen circumstances come to pass. At Fidelity Funding, we look beyond overly simplistic measures, such as our borrowers' verified incomes, in deciding whether to make loans. We take into account the entire circumstances, looking for ways to work with our borrowers instead of reasons to say no. Contact Fidelity Funding today to see if a No Income Verification Loan is right for you!

Fidelity Funding Helps You With Hard Money Loans

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Hard Money Lenders in Los Angeles: 3 Tips for Getting Your Loan ASAP

Whether it's for business or personal use, when you need money, you need it now. That's why when you're seeking loan approval, you want your answer ASAP. To help you get your money and get it now, Fidelity Funding out of Glendale, California presents our keys for getting Hard Money Lenders in Los Angeles to approve your loan as quickly as possible.

Hard Money Lenders in Los Angeles: 3 Tips for Getting Your Loan ASAP

Tip #1: Think Like a Lender The first step to getting your loan approved as quickly as possible is to think like a lender. What we mean is to consider the things that a lender will want to know in evaluating your loan application. Why should the lender feel comfortable making this loan to you? What assurances are you able to provide that the lender will be paid in full under the terms of the loan? To help you think like a lender, here are a few things you should consider: What Is the Purpose of the Loan? One critical fact that a potential lender will want to know is what the loan is for. Different regulations apply to loans that are for personal purposes versus business use, and so it is important to make this distinction before you apply for a loan. Also, being able to explain to what use you intend to put the loan proceeds will help a lender gauge the risk. For example, if you want to take out a loan to pay for renovations to a property that also acts as collateral for the loan, the lender can consider whether or not those renovations are likely to add to the value of the property. Similarly, if you plan to invest the loan proceeds into growing your business, the lender will want to know in detail exactly how the money will help you expand and what this is expected to mean for your cash flow. Having all of this information prepared in advance will go a long way toward speeding up the loan approval process. How Will the Loan Be Secured? Another important step in thinking like a lender is to consider what will act as security for the loan. Frequently, a loan is secured by a mortgage placed on a piece of real property owned by the borrower. However, loans also can be secured by non-real property, such as business equipment. In some instances, a business loan may be secured by a piece of personal property, such as when a business owner secures a business loan by placing a mortgage on his or her private residence. Having an idea of how your loan would be secured before you go asking for a loan will go a long way in demonstrating for a potential lender that you are deserving of being trusted with their money. It shows that you have an appreciation for the fact that a loan is not a handout and that the lender has a valid interest in ensuring that the money is repaid according to the loan terms. Is the Amount of Security Sufficient? When considering how your loan would be secured, it is not enough to simply identify a piece of property and say it can serve as collateral. The value of the property itself—whether a building or a piece of farm equipment—must be sufficient to secure the entire value of the loan, ideally with a decent amount of cushion in case of a reduction in property value. For example, it is unrealistic to ask for a $100,000 loan secured by a $50,000 piece of property. That is not a good example of thinking like a lender. Asking for a $50,000 loan secured by a $100,000 piece of a property gives a potential lender a strong sense of security. Such a loan clearly entails significantly less risk and is therefore likely to be approved much more quickly. Tip #2: Have All of Your Documentation in Order When applying for a loan, you are essentially pitching your case to the lender as to why the loan you are requesting represents a good investment for them. As such, you will need to offer evidence demonstrating the validity of what you are saying. The more evidence you are able to supply, the more quickly the lender will be able to make a decision on your loan application. But just what sort of evidence will you need? Every Fact Needs Supporting Documentation For good reason, a lender will not simply take a potential borrower at his or her word that all of the information contained in the loan application is true. In order to support your application, you should obtain documentation supporting every fact that you include in your application. In many instances, government regulations require that lenders obtain such information. Property Appraisals When determining which documents you will need, consider your answers to the questions under Tip #1. How will the loan be secured? If the loan will be secured by real property, you should be prepared with a recent appraisal or other evidence of the property's current fair market value. A simple printout from Zillow is unlikely to be sufficient but maybe a good starting point. The same goes for any non-real property, like business equipment, that you intend to offer as collateral. Business Profit and Loss Statements If you are applying for a business loan based in part on your business's cash flow, you should be prepared to present detailed statements providing information about profits and losses, cash flow, and other core details about the financial health of your business. Again, the more of this information that you are able to provide up-front with your application, the more you will avoid unnecessary back-and-forth with your potential lender down the line, thereby speeding up the process for their reaching a decision on your loan. Tip #3: Be Responsive After you submit your loan application, it is likely that the potential lender will come back to you with further questions or requests for additional information. One of the best things you can do to speed up the loan approval process is to provide this information as quickly and thoroughly as possible, including by trying to anticipate the lender's questions in advance and providing as much information and documentation as you can in the first instance. Letting a potential lender's questions go unanswered for longer than absolutely necessary only means further delays for you.

Get Your Loan Approved ASAP by Hard Money Lenders in Los Angeles

In conclusion, the best thing that you can do to speed up the process for getting a loan is to anticipate the potential lender's needs and questions in advance so that you can provide all necessary information without their having to ask for it down the line. Also, the stronger of a case you can make as for why your loan should be approved, the faster the approval process generally will go. Ready to put your loan application skills to the test with Hard Money Lenders in Los Angeles? Contact Fidelity Funding today to see how we can help you obtain the funding you need!

Fidelity Funding Helps You With Hard Money Loans

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