Loans can be a tricky thing. Just qualifying for one isn’t enough. You need to help a person find one that truly fits their income so they can eventually walk out with their future secured.
Hard money loan rates are widely becoming preferred by investors and brokers the world over. This is due to their more straightforward nature and quick turnaround time, both of which can mean the difference between an easy lending experience and a nightmare. The average hard money lender is already deeply familiar with the troubles and concerns brought on by borrowing money these days, eager to provide people from all backgrounds a means of achieving their dreams. Should the function of hard money loan rates still be new to you, a little crash course will go a long way.
What Is A Hard Money Loan?
Hard money loan rates are becoming more popular than ever. It’s never been a better time to become familiar with their benefits so you can help people when they walk in for a loan. Hard money offers higher interest rates and lower loan to value ratios than average. These can start at 15%, 18% or even 20%, depending. Hard money loans are usually secured with properties with either 30% or 50% equity, keeping the investor well protected even as the client enjoys a more flexible process.
Who Requests Hard Money Loan Rates?
People of all backgrounds and budgets have a keen interest in a hard money lender that puts their priorities first. New homeowners often prefer hard money loan rates to keep the homeowning process as simple as possible. Because the majority of people buy their homes with either a 15-year or 30-year mortgage, home prices have gradually increased over time. The median amount of home equity for people under the age of 35 usually totals $20,000 or so, though this can certainly change.
Why Do People Prefer A Hard Money Loan?
Not only do hard money loan rates offer more flexible interest rates, they have a host of other benefits that can ease the loan process. Hard money deals are frequently requested for their quick turnaround time, with most requiring just one or two weeks to fully process. Students, in particular, often find themselves in the position of requesting a solid loan due to mounting student loan debt. Student borrowing has been increasing exponentially over the past few decades, with the span between 2000 and 2014 seeing the total volume of outstanding federal student debt almost quadrupled.
What Basics Should I Keep In Mind?
Debt is on the rise. It’s your responsibility to make sure the benefits of hard money loan rates are fully understood and embraced by your clientele so both parties can be satisfied going forward. The latest statistics provided by the Federal Reserve have indicated consumer debt in the United States only continuing to increase, reaching a staggering $3 trillion back in 2015. The average bank loan borrower that wants to take out a business loan needs to have at least two years in the business as well as $250,000 of annual revenue.
Where Does A Hard Money Loan Go From Here?
Hard money loan rates make a complex process simple. Their quick turnaround time means people can be on their way without a second thought, with just one or two weeks for the majority of applicants. Homeowners and students alike benefit greatly from a hard money loan and can enjoy both flexible interest rates and high costs, depending on their goals. The duration and general payment period for a private loan is overall shorter than a traditional loan, meaning hard money lenders will only continue to enjoy steady business as the years go on.
Hard money is the preferred payment method of today and tomorrow. Make sure you always have something better to offer your clients.