Types of Loans: PRIVATE INVESTORS LOANS

LONG BEACH PRIVATE INVESTORS LOANS

“A banker is a fellow who lends you his umbrella when the sun is shining, but wants it back the minute it begins to rain.” – Mark Twain

Private money funds, also known as “hard money,” usually come from private investors or private lending companies who are willing to loan home buyers money to purchase a specific property. These loans could be a great option for homebuyers who are not able to qualify for a traditional mortgage because of less-than-perfect credit, debt or for self-employed individuals who can’t always provide proof of a steady income.

The underwriting of the hard money loan is not so ‘person’ focused as it is ‘property’ focused. A person with poor credit can get a hard money loan if the project shows a likely profit. Loans from private lenders are generally secured by the property in question, so it’s usually not as important to the lender if the borrower has pristine credit or not.

Private loans aren’t paid back over 30 years like a traditional mortgage. Many private-money lenders expect the loan to be repaid within an extremely short time period, such as six to 12 months.  You might consider such a short repayment period if you plan to sell or “flip” the house within that time-frame, or expect to be able to qualify for a conventional refinance within a few months after acquiring the property.

If you have a house you want to rehab, and you feel that you could improve it enough to boost its worth in a short period of time that would allow you to pay off a private loan and replace it with a conventional refinance or sale, then getting a private loan is a viable option.

Have questions about the Private Investor Loan process in Long Beach, or want to get started? Give us a call at (562) 437-5585 ext 1 or email us at nicoletas@allwaysfinancial.com to discuss your needs.

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