Commercial Hard Money Loans: Your Serious Real Estate Investment Opportunity
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How many millionaires do you know who have become wealthy by investing in savings accounts? I rest my case. Robert G Allen
Commercial Hard Money Loan Pros and Cons
Bridge Loans Defined: These are short-term loans, usually from six months to three years, meant to provide quick financing before more permanent financing can be secured or a property can get sold.
Commercial Hard Money Loans: Typically, these are loans to businesses who need quick financing before funds get raised by more conventional means. The security for the loan is business property assets. Why Invest in Businesses? We have already discussed many ways that hard money offers the best real estate investment opportunity. However, a lot of the discussion of hard money loans covers private loans made to individual real estate investors or even individual home buyers. Hard money loans, made to businesses, present another real estate investment opportunity for savvy investors. Best of all, you get the opportunity to back businesses in your community in a secure way. Security of Commercial Hard Money Loans How do you know that your commercial hard money loan investment is kept safe? These loans get backed by the collateral of commercial property that a business seeks. Because the business needs to act swiftly to purchase this asset, they turn to hard money lenders who can provide quick cash. Since the business owners or managers know that these are short-term loans, they are already probably working on permanent financing. All of the information gets disclosed to you – as you work with us to find solid opportunities to profit by backing business. Permanent financing may come from banks, commercial finance companies, or even stock sales. But all of those solutions take time, and business owners may have an opportunity to expand or begin a business that requires quick action. That’s where you, as a commercial hard money loan investor come in. Meanwhile, the actual business property serves as collateral for the loan. Advantages of Commercial Hard Money Loans for Investors
- Diversification: These loans allow you to diversify your investment portfolio by making loans with a fixed and high rate of return that does not depend upon the current economic situation or even prevailing interest rates.
- Security: Since loans are usually made on some percentage, maybe 60 to 70 percent, of the value of the property, your security is the value of the actual business property the loan is made against. If the lender defaults, you have a lien on the property. These properties can get sold, or you can – in some cases – even have a chance to take ownership of them.
- Simplicity: Commercial hard money loans are actually some of the most direct and easy-to-understand types of investment opportunities in the world.
- Position: You are in the first position to get paid if the lender defaults.
And Best of All… Control…
The property has just been appraised, so you don’t have to rely upon old or irrelevant information. Since many properties are local, you even have the right and ability to drive by or tour the property if you like. You have direct control over your decision to invest in one property or another. This is very different than investing in some mysterious fund where you have no actual control over the type and amount of investments that get made,