Many business owners and individuals taking on large projects that usually deal with real estate are quite familiar with hard money lending in Phoenix, AZ. These types of loans provide quick opportunities for projects and business ventures alike. When used appropriately, they provide financial reprieve for many situations.
What Is A Hard Money Loan In Phoenix, AZ?
The basic idea behind hard money loans in Phoenix, AZ is that they provide quick access to cash by means of using collateral. In most cases, your debt-to-income ratio, job history and credit score is not used to determine your eligibility. Most banks tend to have a long application process, forcing you to provide lots of documentation, jump through hoops and wait a long time to receive a response.
What are hard money loans in Phoenix, AZ quicker to process? You might be wondering this very question. For hard money loans, lenders typically use collateral that you have to secure the loan. This collateral then becomes the property of the lender should you default on the loan. It is quite a simple process. Additionally, the interest rates tend to be higher because the loan terms are shorter.
Why Would I Choose A Hard Money Loan In Phoenix, AZ?
You are probably most familiar with soft money loans. These are loans used in situations like your mortgage. The loan is long-term, usually lasting 20-30 years. The lender looks at your ability to repay the loan not by collateral but by your credit history, tax statements, debts and income and employment history. Since a soft money loan is long term, the lender needs to feel comfortable with your long term ability to repay the loan.
A hard money loan is often used in situations like flipping a house, construction, commercial projects and land transactions. The need for the money is immediate and the life of the loan is typically much shorter. Hard money loans usually last at most, six to twelve months. Some hard money lenders are willing to negotiate terms that are longer than twelve months.
How Do Hard Money Loans Work In Phoenix, AZ?
Your experience with hard money services in Phoenix, AZ can vary from lender to lender. Typically, hard money lenders will take each situation on a case by case scenario. The amount you receive will depend on the loan-to-value ratio that is set by the lender. When you borrow funds via a hard money loan, you can expect to sign a purchase contract, wait for underwriting to approve you (this step could take 24-48 hours) and then you will receive the approved amount of funds.
When Should I Use Hard Money Lending Services In Phoenix, AZ?
As stated above, the top reason people turn to hard money lending is through a real estate type project or investment. Many people need to purchase a home to flip it or they need temporary assistance for a buy and hold situation. The money you receive through hard money lending can be used for things like:
Leveraging a real estate deal
Purchase of a trustee or wholesale property
Financing renovations on a property
Acquiring a new residential income property
Update your current home or one you plan to purchase
The need to close a deal quickly
What Else Should I Know About Hard Money Lending Services In Phoenix, AZ?
The first thing you should know is that 1 Stop Title Loans can help with all of your hard money lending needs. We offer competitive interest rates between 12-36%. Your interest rate will depend on your situation and collateral. Our terms are also flexible. We will determine your terms based on your needs and our ability to accommodate those needs.
Final Thoughts On Hard Money Lending In Phoenix, AZ.
Hard money loans are a quick way to receive cash fast when you have a real estate project or investment on the docket. The best part is that your personal or business financials are not taken into consideration. Your collateral will be used to determine your eligibility and loan amount. The process is quick and easy. Be free of mounds of paperwork and nail biting decisions that could take months. Opt for a hard money loan in Phoenix, AZ. today.