Hard Money Lenders vs Private Money Lenders

Hard Money Lenders vs Private Money Lenders

We’re frequently asked if we do hard money
loans. And while our loans have many of the characteristics of hard money loans, they
are slightly different. What we call ourselves, and what is an industry term is “private money
lenders” and the difference is, is that a traditional hard money lender will be looking
strictly at the underlying asset and will be less concerned with the borrower or the
borrower’s ability to repay. As a private lender, we’re fully underwriting the borrower
first and the piece of collateral second and both pieces are equally important. A lot of
hard money lenders in the last few years, due to the issues, the recent economic downturn
and the problems with the real estate market for the last few years, a lot of those lenders
are no longer in business. Another issue with hard money lenders is a borrower should be
very cautious going into a relationship with a hard money lender, because they are really
looking at the asset and are not concerned with the borrower’s ability to repay. And
I think it’s tragic when, in certain circumstances, there’s a borrower that has put sufficient
amount of cash and energy into a property, but couldn’t afford it to begin with and wasn’t
able to make the payments to begin with and they end up loosing that property to the hard
money lender and ultimately it could be that lender makes the money that the borrower had
projected to make or had expected to make and we really try to avoid that by making
sure that when we make a loan, that the borrower can repay the loan. We’re not looking at the
asset as the sole source of repayment. That’s our backup plan, but that’s where we want
to be. We don’t want to be owning the property, we want to be paid back.

One thought on “Hard Money Lenders vs Private Money Lenders

  1. Hard money lenders are playing a big role in our financial sector. They are lending easily and early. Anybody can get loan from hard money lenders if he has property which he can use as collateral. It does not matter if you have bad credit or even have no credit information also. If you are looking for hard money lenders then I will recommend you to contact with Lending Universe Inc. because they have the largest information about hard money loan and lender. They have over 10000 verified hard money lenders to lending money. You also can apply for hard money loan from here. Go to https://www.lendinguniverse.com/Borrower/LoanAppPropertyLoanInfo.asp?purpose=0 to apply for a loan.

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