Getting Multifamily Hard Money Loans

Getting Multifamily Hard Money Loans

No prepayment penalties

It is important to understand that even the best-laid plans can effectively change, hopefully for the better. The last thing a business firm wants is to be penalized for their success if their business operations go particularly well. If the circumstances changes, and loan is either fully or partially repaid before the due date, the traditional financial institutions often charge hefty prepayment penalties. It is essential to understand that the commercial mortgage lenders are completely invested in the success and loan structure of the borrower without prepayment penalties or added charges.

Flexible term structure

Small or medium businesses are constantly adapting to meet the challenging and changing market circumstances. It is essential to mention that traditional lending agencies and banks are not as flexible. Traditional lending institutions take a one-size fits all approach to all requests due to their shareholders and finance committees interest to not over leverage and or take on too much exposure. Some of the well-known and reputed private lenders can systematically structure repayment. They can structure the collateral release terms in ways that are mutually beneficial to both lender and the borrower. Greater flexibility of the finance often results in better outcomes.

Rapid funding of loans

It is very important to understand that it could be very difficult to try to secure even the simplest of loans from any financial institutions in post economic downturn. Banks ask for the borrowers to submit personal and business financial statements and upward to 12 months of reserves of the new intended mortgage and personal expenses. This can result in unnecessary delays in an approval of the loan. Private Lenders can move quickly since they base their decision largely on the liquidation value of the collateral provided. Faster decisions mean the borrower starts moving forward in the business rather than getting caught in funding limbo.

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