Questions to Ask Hard Money Lenders

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Generally speaking people tend to think of direct investing when it comes to real estate investments i.e. either buying a property to fix and flip or hold it as long-term rental. So if you are planning to invest in real estate and looking for a lender offering California hard money direct services, then check out the following post that gathers a few basic questions to ask your hard money lender to evaluate their dependability.

#1 – What is the market credibility of the lender?

Taking hard money loans from a lender is equivalent to building a financial relationship with them. That is why before making any decision you need to review their experience and credibility in the market. Ask them about their years of experience in this field and number of loans they have funded. Have a thoughtful discussion upfront to ensure your chosen professional specializes in this type of financing and is able to communicate efficiently.

#2 – What is the capital source of the lender?

There are a few different sources of capital for most hard money professionals.  The most common are individual investors, pooled investors, an in house fund, semi-institutional and various resources built over time.  There are advantages to each of these, but working with a hard money lender that utilizes multiple sources through their relationships built over time will help ensure you have access to more than just one program.  In times of tight funding, having multiple relationships is ideal for helping to get your deal done.

#3 – What is their draw process and how it works?

Hard money loans for a fix and flip project usually will not release all the funds at once. The lender and the client need to work on determining the various stages of the home renovation. At each stage, a predetermined amount of cash is released. However, you need to ensure that the lender agrees to make changes to the schedule whenever needed. Moreover, you also need to realize how long a draw will take.

#4 – What is their lending terms?

Every hard money lender offers different lending terms based on the needs of their clients. Make sure you realize the rate of interest and the length of the loan. Ask if required can they extend the loan and how as well as the costs associated with the extensions. Also, make sure to ask regarding origination fees.

Furthermore, ask their type and their down payment requirements. Generally there are two types of lenders i.e. after repair value (ARV) and loan-to-cost (LTC).

Conclusion:

All California Lending is a genuine and experienced private financing firm that specializes in providing hard money loans in and around California. If you want to learn more about their California hard money direct loans, then visit https://www.acalending.com/california-hard-money-seconds/
Location: California, USA

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