Commercial Hard Money Lender
Commercial hard money is issued to a business entity or individual signing on behalf of a business entity or corporation. It can be secured against a commercial property or residential investment property. It can also be secured against a residence in conjunction with a business property as a means of obtaining additional collateral for the lender. That type of additional security is referred to as a blanket mortgage. The sources of asset based commercial hard money loans are generally the following:
- 1. Private Individuals
- 2. Mortgage Companies
- 3. Federal Banks
- 4. SBA Lenders
Loan terms vary from hard money lender to hard money lender. Be sure to carefully review the lender's interest rate, prepayment penalty, loan to value, default rates, APR, work out solutions, points (fees for the loan), etc. For example, a private individual may offer a lower interest rate than a hard money lending company, but may be unwilling to offer a work out plan, in the event the loan becomes delinquent, or a hard money lending company may offer a lower interest rate, but demand a high pre-payment penalty fee, costing the borrower more money if they decide to sell or refinance the loan within one to five years. Because these terms are not standardized across the industry, it is important to check with each lender and ask them for their "terms", as well as how long it will take them to close your loan.
Read more about this topic: Hard Money Lender
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