The loan process can be a long one—even before you officially qualify. Depending on your project, you may spend months planning and researching before you even really get started. When it comes time to seek a loan lender, the loan process won’t even begin immediately—it can take as long as a month or more to get things rolling. So, what should you do when you don’t qualify for a loan from your traditional lender? Easy—seek out other lenders.
What kinds of lenders are there, though? And what type of lender is best for you? Usually it comes down to understanding the difference between public and private lenders and the types of loans they offer.
Traditional lenders are usually compromised of local banks and credit unions. They have high standards when it comes to borrowing money. They value experience, reliability, and reputability. A great credit score, financial history and debt to income ratio will all be important things they consider before approving you for a loan—any or all of these things can make or break you. Fortunately, there are untraditional lenders who put collateral before financial history, and therefore give greater chances to people who otherwise wouldn’t qualify with traditional lenders. Untraditional lenders, or private money lenders, focus on you, your property and your plans. They are generally blunt with you, and if they don’t support your plans they will tell you. The transparency they offer is part of the individualism that isn’t always present with public lenders. In addition to the opportunity they offer through their selection process, Arizona Private Money Lenders also allow opportunity through their speed. A traditional lender may take a month or more to get the process going—a private lender can get the process going as soon as a week and, sometimes, the day of. Every situation and project is difference, but speed is never a bad thing.
If you aren’t eligible for traditional loans, private lenders offer a few benefits you won’t see elsewhere. However, there are some risks of working with Private Money Lenders. For one, they have high interest rates and fees. Unlike the rest of the market, the costs of private lenders can be up to five percent higher. Not only that, but they have short repayment periods. Depending on what you need your loan for, this may not be the best option. Private lenders offer hard money that is expected to be paid back fast. Generally, this makes hard money ideal for cases of fixer uppers and foreclosures. Determining if a hard money lender is right for you will require you to evaluate your situation. Just because they can get you the money faster or at all, compared to other lenders doesn’t mean they are the best option.
Level 4 Funding LLC
Hard Money Lender
Hard Money Loans
Hard Money Loan
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis Dahlberg Broker/RI/CEO
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave | Austin | Texas | 78701
About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 43 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.