Getting a hard money loan in LA or San Diego isn’t difficult nowadays if you’ve the right information. The process followed by real estate private money lenders isn’t exactly the same as that of traditional banking institutions.
Here’s what you should know about securing private money for real estate projects:
1. Is the Property Really Worth the Risk?
Private money is made available against the collateral i.e. the property in question for which you need capital.
So, unless a property and its location in San Diego or LA are a safe bet, a lender will almost certainly hesitate to entertain your request.
2. Decide on an Exit Plan
Lenders would want you to come up with an exit plan.
If you’re lent $1million, for example, the lender would be keen to learn how you plan on returning this money in 1-2 years time frame.
Do you such a plan ready?
If not, may be you need to revisit the idea of investment.
3. Keep the Documentation Ready
Hard money loans are granted against the collateralized property but the lender may almost certainly be interesting in learning more about your financial condition, portfolio and other such things.
Information about credit, annual income, asset ownerships etc. should be kept ready at the time of contacting a lender.
Take pictures of the property, gather estimates from contractors and prepare detailed plan for costing. Also, make sure to follow-up on phone calls, emails and other such communications promptly.
Make a real estate private money lender believe that you mean business!