Hard Money Lenders

How do you know if a hard money lender can really fund your loan? Be careful as you search for a hard money or private money loan. There are many brokers who claim they are the “gatekeeper” to some large funds. The frustrating part is that more often these brokers are smoke and mirrors. If your broker represents a real source, they will have funded loans with them within the last 6 months. If it has been longer than 6 months since the broker’s or lender’s last closing, you should be very cautious.

Be careful of upfront fees that may be assessed. In many cases these “smoke and mirror” brokers/lenders will assess a large fee upfront before they will look at your deal. This is not the case for the majority of true sources. Most true sources will ask for a due diligence fee at the time a commitment letter is issued. Depending on the size of the loan the due diligence fee can feel like the lender is taking a chunk of flesh. In any case, make sure you send your money to the lender and not the broker.

Having the right expectations and knowing a little about the process of hard money lenders will go a long ways in protecting yourself in the process. It can be difficult to find true sources of funds when there are so many “talkers” in the industry. We strive to take the guessing out of both bankable and non-bankable deals.

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