Want to do more deals? A hard money lender in Philadelphia can help…
If you’re a real estate investor doing deals in and around the Philadelphia area, you may come to a point where you simply can’t (or don’t want to) do deals using your own capital and credit. And perhaps like many investors, you don’t want to reach out to family and friends for capital either. So, where do you get more money to fund more deals? One of the best places to go is a hard money lender in Philadelphia.
Hard money lenders are private lending firms (not banks) that provide fast, simple real estate loans, which are ideal for rehabbers and other real estate investors. As it turns out, hard money isn’t even hard to obtain!
When you start looking at hard money lenders in Philadelphia, how will you know which one to choose? Hard money lenders can have very different borrowing practices, operate at very different levels and make loan funds available in very different ways. Do as much research as you can online, but you should know that you can interview prospective lenders. It may be important for them to know you’re a good borrower, but it’s just as important for you to know they are good lenders.
To help you find the best lender to work with, here are 11 questions you can ask them…
1. How many rehab loans have they done in the last year?
2. Describe the kind of projects you’re doing and ask, “do you fund other investors who do deals like I do?”
3. Where does their money come from? Are they the actual lender or are they a broker for some other lender?
4. Do they check your personal credit? Is there a minimum score required?
5. Do they rely on third party appraisals or underwrite loans in-house?
6. What is their draw process? Hard money lenders do not usually disburse all of the loan funding at the time of closing. Draws of the loan proceeds may occur upon completion of defined stages of the project or periodically (monthly).
7. What fees are there on the loan? What kind of interest rate should you expect and how many points will they charge for the loan?
8. If they provide you a quote for a rehab loan, are they firm on the terms?
9. What happens with your loan if the project takes longer than expected? Can the loan be extended?
10. Are they only hard money lenders or do they also rehab houses?
11. Ask them: “What other services or help do you provide?” Good hard money lenders shouldn’t only be concerned with lending you money and getting it back. The test of a great hard money lender should be in the extras they provide, such as advice or in-depth analysis of deals, including recommendations on how to improve your return on investment.
If you want to borrow money from a hard money lender in Philadelphia, do your homework. Ask around. Check with other real estate investors or agents. And be prepared to ask questions of prospective lenders so that you can be confident you’re making the right choice.