Finding the best investment lenders requires consideration into the best lending situations for you as a real estate investor. The difference between traditional loans and lenders is that the latter act more like business partners than saving graces.
To make the most out of your investment, you need to find an investment lender who is willing to work alongside you to get the most out of the process as possible.
If you’re interested in finding the best investment lenders near you, see more to learn six factors to do just that!
1. Consider Their Reputation
Before hiring anyone to work with you on getting your loan, you need to do some background research on the lenders you are considering pursuing.
Anyone can represent themselves as competent online, but if you want to discover the lender’s actual reputation in the business, you need to conduct your own research and review feedback, social media engagement, and more to determine how you really feel about working with them.
Remember that hard money lenders need to make money too, so how they present themselves to the public is not necessarily the whole story.Try to contact previous clients or business acquaintances of the lenders you are considering so you can get an honest opinion of what they are like to work with before deciding to work with them or signing a contract.
2. Hard Money Lenders And Work Ethic
Understanding the work ethics of each of the lenders you are considering is essential to getting your loan approved quickly. You want someone who can work quickly and efficiently, so make sure the lenders under review can keep up with your demands.
The best lenders can obtain loan approvals in a matter of days. Don’t settle for anything more than that! At the same time, look out for anything that sounds too good to be true. Loan approval is still a process, even when you have a lender working for you who is connected.Inflated promises and expectations are never a good sign. You want to find a lender who can meet you in the middle and offer you practical solutions.
3. Are They Affordable?
Even though hard money loans have steeper interest rates than traditional loans, your lender should still be able to offer you under 12% interest.
If it is proposed that the interest rates should be higher because of the shorter time frame of the loan, this is a red flag that it is time to look elsewhere.The best hard money lender wants to meet your needs and can do so.
Again, using some common sense and not going with the first deal in savings you find is the wisest approach when considering different lenders. Those with less experience are more likely to charge less for their services, and saving money is certainly not the only goal here.
You need to keep in mind what you want to get out of the process and decide for yourself how the lender you are considering can actually help you.
4. Are They Accommodating?
The best hard money lenders will create ways to make the process easier for you across the board. When you consider working with someone, ask about their promises and how they stand out from competitors.
If you’re guaranteed 24-hour approval turnaround time, fast financing, and no unnecessary fees, this is a team you should consider working with. Companies that cannot meet these objectives are not showcasing the kind of flexibility you need to move forward.
Even when the lender appears confident and firm about any inability to meet your expectations, you still owe it to yourself to check the facts before believing everything you hear. There could easily be an individual lender or team out there who can completely meet your needs without the hassle.Take your time finding the best lender for you and your investments.
5. Are They Easy To Spot?
Hard money lenders who are serious about business will make their online presence known to you. You shouldn’t need to do more than a quick search to find ads from lenders, top-ranked business websites, and more.You can also reach out to a real estate agent and ask if they are networked with any lenders.
You should not have to search high and low to find a solid lender, and if you settle for someone at the bottom of the barrel, you’re probably not getting the best of the best.Find easy opportunities that are right in front of you.
6. Are They Fair?
If you’re not familiar with relying on the lender, take some time to learn the basics of the industry before you decide to work with anyone. Investors looking for a hard money lender often make the mistake of assuming that the process is the same as conventional financing.
There are many differences in the financing process for a hard money lender, and you must familiarize yourself with these differences beforehand.Without knowing the patterns and expectations that fall in line with a lender, you’re at the disadvantage of being taken advantage of by a less competent lender.
A Final Note: Compile Your Savings
Although these lenders have the reputation of flexibility and meeting the client where they are, you still need somewhat of a nest egg to make the process work. As an investor, you should expect to make a sufficient contribution if you want to work with a qualified lender.
It will be nearly impossible to find a lender that is okay with no borrower contribution. Those who are fine with this will likely lack the other factors, i.e. (reputation, rates, etc.), that are necessary for the job.
The Main Takeaways
To find the best investment lender near you, consider the above six recommendations before conducting your search. Ideally, your lender will provide you with quick loan approval and funding, and a willingness to meet you where you are.
Don’t settle for anything less than the best!