HomeVestors says Hard Money Loans can Solve Financing Problems


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After 15 years in the real estate industry, HomeVestors has worked with real estate investors of every kind. The largest problem that these investors have faced over the years is how to pay for their real estate investment properties. Since banks are limiting the amount of funds they hand out, finding money for business purchases is becoming harder and harder. Smart real estate investors will choose to explore hard money loans.

Hard money loans make it possible for investors to purchase real estate investments. These loans are obtained from private, individual lenders. They normally have a higher interest rate than a normal bank loan, but their requirements and restrictions are more relaxed.

There are a lot of benefits to using hard money loans. The type of real estate investment does not matter. They can be used for foreclosures, short sales, rehabs, residential, and commercial.  The money can be used to purchase the property, to construct, or to renovate it.

Since they are typically handled by an individual, private loans or hard money loans provide real estate investors with options they haven’t previously had. The loans are usually more flexible. They can arranged to fit the investor’s needs more easily. In addition, hard money loans have fewer contingencies to be added to real estate transactions. This allows for higher consideration from sellers.

Another benefit for real estate investors is their expediency. Hard money loans are usually quicker to the  obtain than traditional loans. Instead of the weeks and months waiting to hear of the bank’s approval, most private lenders will let investors know within days if the money is available. In addition, the lenders typically are less concerned with the borrower’s credit score and more concerned with their personal character and the amount of money the loan will make them.

Real estate investors need to go in with their eyes open. Although the loans are easier to obtain, the loan rates and terms are typically higher than traditional loans, especially since there’s no competition. Generally, the terms are set up where a quick repayment will ensure higher profits for the real estate investor, but longer repayments may start eating those profits up.  In addition, the real estate investor must have enough money tucked away to prove he will be able to pay back the loan no matter what happens in the future. Private lenders love loaning money, but they do need that money returned. Failure to pay may result in the investor losing some assets in order to repay the loan.

About HomeVestors of America Inc.

Dallas-based HomeVestors of America, Inc. is the largest buyer of houses in the U.S., with 50,000 houses bought since 1996. HomeVestors trains and supports its independently owned and operated franchisees that specialize in buying and rehabbing residential properties.  Most commonly known as the “We Buy Ugly Houses®” company, HomeVestors strives to make a positive impact in each community.  In 2012, for the seventh consecutive year, HomeVestors was among the prestigious Franchise Business Review’s “Top 50 Franchises,” a distinction awarded to franchisors with the highest level  of franchisee satisfaction.  For more information, visit www.HomeVestors.com.

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