4 Ways to Find the Right Private Money Lender
Recent statistics from the Federal Reserve show that consumer debt is on the rise, amassing a total of $3.4 trillion in May 2015. Many people are realizing the benefits of obtaining funds through private lenders. It makes sense to feel confused at how to find the right lending company. Here are four considerations to make when finding a private money lender.
- How You’re Initially Treated
It’s important to note how you’re treated when dealing with a private lender. You’ll want to find out that a lender treats you as a valued customer. If a lender puts too much pressure on you, it might be time to find another business. You’ll find that hard money deals are often preferred for their fast turnaround time. If you get a bad feeling from one lender, fast turnaround times ensure you’re able to meet another company with time to spare.
- Good Reputation as a Lender
You’ll find it’s comforting to work with a lender that values you as a customer. It’s important to ensure that a lending company has a successful track record. Certain lending companies specialize in working in specific industries. For instance, a small business owner would benefit highly from finding a lender that specializes in business loans. The typical borrower looking for a business loan will need to be in business for two years and have $250,000 annual revenue, with the addition of good credit. It’s understandable that increasingly tight lending regulations make private money lending a wiser choice.
- Interest Rates Offered
Many people choose private money lending. Private lending allows you to receive money faster and with fewer hurdles than traditional lending. It’s known that private lenders will need to utilize a slightly higher interest rate to help protect their investments. You’ll want to find a hard money lender with agreeable interest rate terms.
- Flexible Loan Terms
It’s important to ensure that you find a private money lender with agreeable terms. You’ll want to speak with a lender to find terms that work well for both parties. If a lender isn’t willing to work with you, it’s time to find another lending company. Many hard money lenders are willing to negotiate terms relating to payment amounts and payback times.
In closing, there are several considerations to make when finding a private lender. You’ll want to work with a lender that respects and cares for you as a customer. A rude lending company might only be concerned with getting you to sign on the dotted line. Private borrowers will pay higher interest rates than traditional borrowers. It’s important to find a private lender with agreeable interest rates. You’ll want to find a lender that offers flexible loan terms. Private lending continues to be a great option for those wanting to skip the restrictions and wait times associated with traditional loans.