Don’t Know Any Private Money Lenders? Here’s 5 Reasons You Should
A private money loan is any loan from a non-bank source of financing. Auto loan financing is one type of private money loan and a hard money loan used in real estate investing is another type. Because these loans do fund much faster than bank loans, it is good to know a private money lender. Below are just some of the reasons why you should know a few private money lenders:
- Bad Credit Nightmares: If you have bad credit, knowing a few private money lenders is a must.
- Fast Real Estate Acquisitions: Good real estate deals don’t wait for bank financing. Because private money lenders fund quickly and with no frills, they can operate similar to cash in a real estate acquisition.
- Inventory or equipment purchases for business: Private money lenders will step up to provide credit to small business owners when banks will not.
- Buy Outs: Often it is cheaper to pay interest on a loan rather than keep a bad partner in an investment. Private money loans are commonly used for this purpose.
- Repairs to real estate owned: Private money lenders will lend on repairs, improvements, construction, etc. whereas bank lenders are more tight on issuing these types of loans.
Having good relationships with private money lenders is key to creating opportunities and solving problems. What else would you add to this discussion as to why someone should know a few private money lenders?
