Real estate investors know that buying properties and fixing them up to flip or rent can be a capital-intensive process! Sometimes you need more money than you have access to at the moment to help you acquire a property, or even to hold you until you can sell or rent it out. There are many ways to access capital but one of the most popular ways is through borrowing from hard money lenders. In this blog post, you’ll read about some of the advantages of hard money lenders in AZ.
If You’re An Investor, There Are Many Advantages Of Hard Money Lenders In AZ.
Hard money lenders give you access to more capital
It’s not always possible to do deals with the funding, capital, or credit that you currently have. So hard money lenders give you more access to capital so you can acquire a deal or complete it. The primary benefit is that these lenders can move much more quickly than traditional lenders, which is super important where speed or lack thereof can be the difference between getting a deal or not. The secondary benefit is that qualifying for these loans doesn’t require the paperwork, credit, or processes you’d expect from traditional lenders.
Hard money lenders often have real estate investing experience
Hard money lenders may not be active real estate investors, but many of them got their start doing just that. And many will have looked at a multitude of real estate deals and can actually help you understand if your deal is suitable for a loan or not – which might be an excellent way to help you determine the quality of the investment you’re looking at. Think of them as a second set of eyes!
Your credit may not matter to hard money lenders
If you’re a real estate investor with bad credit or even no credit or one who just doesn’t want to utilize your personal credit because you need it for something else, a hard money lender might still be able to fund your deal. Many of them are asset based lenders, meaning after a preliminary “soft credit” pull, they’re determining whether or not to lend based on the asset or property – meaning the reason is that they are willing to do this is because they are making a secured loan – one that is backed by the asset itself. You don’t pay, they take ownership of the property at a deep discount.
Hard money lenders are a financial “tool” in your toolbox
As a newer real estate investor, you’ll tie up your capital and manpower into a deal. And if you can’t complete that deal (because you can’t fully acquire it or you can’t get it up to a level of repair for rental or resale) then the deal will stall. A hard money loan can help get the wheels turning again ease that situation and get the deal moving forward so you can complete it. Hard money lenders shouldn’t remain your only source of capital, but in the beginning, they likely will be. After you’re established they can still be a great help in a pinch – that’s one of the advantages of just being aware of hard money lenders in AZ and nationwide.
Hard money lenders in AZ and respective states are familiar with their state laws
You can lean on hard money lenders in AZ to be familiar with the lending and investing laws of their state. That is valuable knowledge to rely on, and it’s one reason why hard money lenders can be a better capital source than other less formal capital sources.
Hard money lenders help you to do more deals
Perhaps one of the biggest advantages of hard money lenders is that leveraging their resources can help you do more deals. Most of us have finite cash reserves – eventually, we run out. A hard money lender can help you access the capital you need to move forward to complete deals, to earn more money so you can do even more deals. This can have a snowball effect where you use money and profits from completed deals, and perhaps another loan from a hard money lender, and do even more deals or even bigger deals or even faster deals or even more profitable deals… all because of the hard money.
If you’re a real estate investor looking to fund more deals, a hard money loan might be the right choice for you. There are many advantages of hard money lenders in AZ so find out more about how a hard money lender can help.