Often times conventional lenders such as banks, lenders and credit unions can promise to fund a loan for a borrower and then back out during escrow.  This can cause issues for the borrowers. This usually happens once the conventional lender stumbles across some small detail they weren’t previously aware of. This leaves the real estate investor in a very difficult position as they do not have enough time to get approved for a new conventional loan and out of luck. This is a perfect situation to utilize the services of a top-rated hard money lender like OnlinePrivateMoney.com who can approve and fund hard money real estate loans within a week or faster. If necessary, OnlinePrivateMoney.com can fund a loan within 3 days and save a deal from falling out of escrow. Short-term hard money loans are the professional real estate investor’s choice when in need of funds fast.

Foreclosures, short sales, bad credit and bankruptcies are immediate red flags that will prevent a real estate investor from obtaining financing from a conventional lender. Regardless of the situation that caused these problems, banks will not lend to borrowers with these types of issues on their record for a specified amount of time. Hard money mortgage lenders can fund bad credit borrowers under the right circumstances. Asset-based hard money lenders in California list the property value and the amount of down payment (or equity) from the real estate investor as the most important factors when considering a loan scenario.

Banks do not like lending to entities. They want an individual who will be personally responsible for paying off the loan. Because of this it can be very difficult to obtain financing from a conventional lender if the investor plans to take title in an entity. For many investors this drawback prevents them from taking advantage of certain tax and asset protection strategies. With private money lenders, taking title in an entity is not a problem.

Conventional lenders don’t like dealing with self-employed borrowers. They prefer to work with a borrower who collects a regular paycheck from a corporation. They also want to see that the borrower has a stable employment history and has been in their current position for at least 2 years. Full-time real estate investors are generally self-employed and don’t have a regular paychecks. Residential hard money lenders are able to fund owner occupied hard money loans for individuals who are self-employed or don’t currently have 2 years of employment history. Once the individual has 2 years of employment history they may be able to refinance out of the owner occupied residential hard money loan into a conventional loan.

When applying for a conventional loan there is a lot of filling out paperwork and waiting. Hard money real estate lenders generally have a short, standard loan application. Once completed and returned, the approval process can be done same day. Compare this to a bank’s application process which can take up to 30-45 days to receive a loan decision. Hard money mortgage lenders are the clear choice for real estate investors who need quick approval and funding.

Most banks limit the amount of loans per investor to 4. This is an arbitrary number that many banks abide by. It could be an otherwise very good loan for the bank in every other respect, but the bank will still resist approving the fifth loan. Hard money direct lenders are not concerned with how many investment property loans a borrower has, they are only concerned with helping the borrower achieve their investment goals.