Any commercial endeavor requires one thing – the funds to get it finished. Finding commercial financing for any project, whether it is real estate investing, construction, or something else entirely, can be difficult at times. There are numerous choices available, and finding a hard money mortgage lender Houston TX is one option that’s well worth looking at in many instances.
A hard money mortgage lender Houston TX offers what is known as a hard money loan. These types of loans have several key features that set them apart from other loans including:
• They are secured by assets like real estate property. Instead of looking at your credit score or your income levels, hard money lenders primarily look at the value of the assets you’re using to back your loan.
• Most hard money loans have a loan to value ratio of around 60 or 65 percent, helping keep the lender somewhat protected due to the riskier nature of the loan.
• Terms and rates are also usually stricter in a hard money loan. You’ll end up with higher interest rates due to the fact that the lenders are taking a larger risk by basing their loans on your assets instead of your credit history.
• These are usually short term loans extended for a far shorter time than traditional loans. As such, they’re often used as bridge loans that help secure funding until a better traditional loan can be obtained or for occasions when an opportunity is present that won’t be available for long. Since it’s faster to get a hard money loan, it’s possible to secure one and then get a traditional loan later.
• Lenders can set their own terms and rates, which is why you’ll find huge variances in the terms of the loans throughout the area. It’s important that you take the time to shop around and find the best loan for you and your situation.
It’s true that in some cases, hard money loans are used by those who have trouble with credit history and other financial issues. But it’s far more common for them to be used as a way to move a commercial project forwards while trying to reach the point that you qualify for a better loan. No matter how you use them, these are a viable method of financing that deserves attention from anyone. They could help you take the right steps towards your goals.
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