Already on ArticleSlash?

Forgot your password? Sign Up

Hard Money Commercial Loans - A Critical Overview

Brian Garvin
 


Visitors: 198

Getting a Hard Money Commercial Loan isn't the simplest task in the world, but in this modern era of technology, it's a lot simpler than it used to be 15 years ago. However, in order to get a loan like this there are certain things you'll need to be aware of, that will make you navigate through the rough waters much easier. Once you read this article you'll be on the pulse of what's going on.

Why Would Someone Want Hard Money Commercial Loans?

The main reasons are that these types of money financing solutions are so notable is the pliability. I've heard of companies offering this type of business loan collectively unsecured, with no collateral. But these loans are under 500k. Business Cash Loans of 500k to One Billion are most frequently backed by Real Estate.

People tend to use these Hard Money Commercial Loans as Procurement or “Bridge Loans". They want to fuse the imperfection meaning they will tend to use this commercial finance loan while they wait for their traditional financing kicks in. The problem with these loans is that they start at rates of 11-16%. This is relatively 5 points more than a conventional loan.

What Types of Hard Money Loans are out there?

You can acquire a loan like this for commercial property. This can be anything from a Strip Mall to a Grocery Store to a small office suite. You can also use them for a residential investment such as a tract home development. I've heard of loans $100,000,000 and more just for one loan of this type. The Industrial Hard Money Commercial Loan is also very popular.

Hard Money Commercial Loans cover everything from Office Land to Technology Parks. Technology parks are becoming more popular in urban and suburban areas. These are basically warehouses and factories. If you've ever been in an area where you'll see a computer warehouse, next to it a warehouse selling motorcycle parts, then next to that a carpet warehouse, that's a technology park.

Hard Money Commercial Loans also go by exclusive factors such as a Favorable Credit Score, Preferable Proceeds and other determinants. This obviously affects rates as well. The more your score, the more your LTV. LTV stands for Loan to Value Ratio which is the prime factor of the value of the property the bank is willing to loan on. When applying for a outrageous loan of this type your Credit Score and tangible history isn't weighted as much as how long you've been in business. Is your enterprise is prosperous, massively prosperous or failing?

The logic the rates on Hard Money Commercial Loans are so high is because they have to listen to the possibility of the borrower going into default. These financial loans don't shield the Investor or the Banks from the large failure rates on behalf of the borrower.

But it's important to note that these types of loans are closed everyday. Business moves on and the world moves on accordingly. When trying to find a lender that will help you acquire money financing of this type, make sure you at least setup an conference. This doesn't have to be an in person interview, since many lenders are nationwide now. A telephone interview should be satisfactory in most cases.

People get Commercial Finance loans at high risk because they tend to make a lot of money regardless, so if you can justify the high interest rates of this type of loan, and can work it out on paper where your company will receive a high profit margin regardless, go ahead and give it a shot!

Whether you're looking for Prime Rates or Commercial Finance Options there is definitely a viable solution for you.

Let Brian Garvin & Jeff West teach you More about Commercial Real Estate Loans and find out more about Hard Money Commercial Loans today. You can always call us for Free Real Estate Advice as we have a lot of resources to help you find what you need, with no obligation.

(694)

Article Source:


 
Rate this Article: 
 
Private Real Estate Money - The 5 Advantages of Private Money Over Hard Money ..
Rated 4 / 5
based on 5 votes
ArticleSlash

Related Articles:

Hard Money Commercial Loans Revealed!

by: Christopher G Burns (August 12, 2008) 
(Finance/Commercial Loans)

Hard Money Commercial Loans - What to Watch Out For

by: Jeff Rauth (June 23, 2008) 
(Finance/Commercial Loans)

Hard Money Commercial Loans - Common Borrower Situation

by: Jeff Rauth (April 25, 2008) 
(Finance/Commercial Loans)

Private Commercial Mortgage Loans - Banks Are Not Lending, Hard Money to the ..

by: Glenn Fydenkevez (September 14, 2008) 
(Finance/Mortgage Refinance)

Private Commercial Mortgage Loans - How to Approach a Hard Money Lender - Keys ..

by: Glenn Fydenkevez (July 28, 2008) 
(Finance/Mortgage Refinance)

Commercial Hard Money Loan - An Honest Review

by: Brian Garvin (June 09, 2008) 
(Finance/Commercial Loans)

Private Hard Money Lenders And Working With A Commercial Mortgage Broker

by: Donna Lewczuk (May 15, 2008) 
(Finance/Mortgage Refinance)

Hard Money Commercial Mortgage Loan - Three Ways to Guarantee Approval

by: Glenn Fydenkevez (September 22, 2008) 
(Finance/Mortgage Refinance)

Commercial Mortgage Loans - You Can Still Get Loans For Apartments, Plenty of ..

by: Vincent Remealto (January 15, 2009) 
(Finance/Commercial Loans)

Private Real Estate Money - The 5 Advantages of Private Money Over Hard Money ..

by: Mike Lautensack (August 17, 2008) 
(Finance/Mortgage Refinance)