Asset based lending? SelfEmployed banks won’t consider me yet.

3 Replies

I’m Self Employed I just started. Can’t refinance my 1st property yet but I have another great deal. Banks won’t lend since a don’t have a 2yrs history. An investor I had got cold feet since it’s his first deal. Now I’ve heard of Asset based lending? Any info on that?? Or where can I find a Hard Money lender?

@Abel Marin yes, there are certainly loans that can be based on the property itself.  A hard money loan is a type of loan that fits this mold but it is a temporary loan.  So you will need another loan if you plan on keeping the property long term (renting it for example).  So if you know what loan type you need then just post in the state forum where the property is located and there's a good chance a local can point you in the right direction.  Thanks!

@Abel Marin Asset based lending is what Hard Money Lenders do. HML & Private Money Lenders basically do the same thing. I like to tell folks that a PML is more like Jim who lives the next street over and wants to lend locally. A HML more likely in the lending business be it county/ regional, state wide, or even as large as nationwide. That said you will find the terms used interchangeably by lenders. Some HML lenders even advertise against borrowing "Hard Money" in favor of their more better "Private Money".

Bottom line is if you don't have to disclose your income, verify employment,, show Tax returns, etc., you are borrowing using an equity based loan. They come in all kinds of flavors. Short term (6-24 months interest only) all the way to 30 year amortized loans.

But it is important to note: Due to the lending laws (and unless you are borrowing from "Jim"), equity based lenders will almost allways want you to borrow in the name of an entity and certify you will not be occupying the property while their loan is against the property.

Feel free to PM me or post any further questions you have here on this thread.