Funding Solutions

Hard Money Loans

Hard Money loans are a fast and easy way for any small business to get the cash it needs. Free from the restrictions that regulate traditional bank loans, hard money lenders can underwrite loans in a few days or hours. This speed enables small businesses to act fast without going through a lot of red tape to borrow funds.

WHat is a
Hard Money Loan?

If your business wants to take advantage of limited-time opportunities, such as equipment sales or property deals, a hard money loan could be the solution for you. Talk with your broker to learn more about hard money lenders.

Hard money loans are also easier to qualify for than most traditional business loans. Because hard money loans are secured on real property or “hard” assets, lenders don’t put as much emphasis on the borrower’s credit score. These loans are popular with newer companies that don’t have a long credit history to draw from, but they are also used by large, established businesses that have a significant portion of their value tied up in assets. They also work well for businesses working on repairing credit. Making timely payments on a hard money loan typically increases a business’s credit score.

How Are They Used?

The most popular way to leverage hard money loans is by using them to purchase real estate. In a competitive market, prime properties disappear quickly. Making a cash offer can mean the difference between getting an ideal location and having to settle. A traditional bank loan may take weeks or months to be approved. That leaves time for another buyer to come in and make a successful bid.

A business can secure a hard money loan on the new property being purchased or another property the business owns. Other assets can be used in conjunction with real estate or instead of it. But hard money loans work for more than just properties. Equipment, inventory, and working capital are other ways to fund small business needs with hard money loans.

Funding Options

Inventory 

If your business needs cash and has valuable inventory, you can leverage it to secure a hard money loan. Use the loan to bring in more inventory, materials, equipment, or working capital to apply where your business needs it the most. Ask your broker to find the best hard money lenders for you.

Equipment 

Equipment can be costly to replace or upgrade when it’s most important. But if that equipment breaks down, it could bring production to a halt. Keep your small business running with a hard money equipment loan. It helps manage the upfront cost of replacing equipment and gets your business up to speed right away.

Real Estate 

To get the best real estate for your small business, you have to be competitive. Be prepared to move fast with a cash offer. Hard money loans can get your business cash right away, so you don’t have to wait weeks or months for approval. Use the new property to secure the loan, even if you have credit problems.

FAQ’S

Q. When is a hard money loan not the best option?
Hard money loans are great when you need quick cash for your business. But lenders provide this convenience at a cost. Most hard money loans have higher interest rates than traditional bank loans. If time isn’t a factor for you, waiting for a long-term loan could save you money in interest payments. Ask your broker for more details.
Q. Can I get a hard money loan with bad credit?
Although hard money lenders do look at credit scores, they’re not the only important part of your application. Hard money lenders are more interested in the value of your security, or collateral, assets. If your assets are enough to cover the cost of the loan, you can get a hard money loan even with a low credit score.
Q. Are hard money loans risky?
Before considering any loan, it’s important to assess the financial health of your business. Any loan is a bad idea if you can’t afford to pay it back on time. Hard money loans can have higher interest rates and shorter terms than other types of loans. It’s important to keep these factors in mind when looking at your financial options. Your broker can help you determine the right type of loan for your business.
Q. How long does it take to get a hard money loan?
Hard money loans can be approved in just a few hours. For this reason, they’re an ideal solution for any small business that needs cash right away.

Advantages

Hard money loans can be approved in less than 24 hours.

Loans are based on collateral assets, not credit scores.

Use property, equipment, inventory, or a combination of assets.

No long-term debt.