When looking for a hard money loan in the Los Angeles area, it can be difficult to know where to start. How does one find a lender, and how does one know if that lender is the right choice for you? To help simplify the process, we put together our keys to finding Hard Money Loans in Los Angeles.
4 Keys to Finding Hard Money Loans in Los Angeles
There are many different strategies when it comes to finding a hard money loan. Some people prefer to ask around and find potential lenders via word of mouth. Others perform a simple online search. Still, others might check with a third-party organization, such as the Better Business Bureau. Whatever strategy you choose, here are some keys to finding a loan:
Key 1: Find the Right Loan, Not Just Any Loan
When searching for a hard money loan, it is important to keep in mind that you are not looking for just any loan or for the first loan that comes around. You are looking for the right loan for you. This can be one of the most difficult parts about finding a loan, and it often requires patience on the potential borrower’s part.
Sometimes, after searching long and hard for financing, a potential borrower will be willing to settle for whatever offer they can find. However, in many instances, a bad loan can leave you worse off than no loan at all. That’s why our first key to finding a hard money loan is to make sure you find the right loan for you and your situation.
What Does It Mean to Find the “Right” Loan?
Before even beginning your search for a potential lender, you should determine exactly what kind of loan you are looking for. You can start by answering some of the following questions:
- Will you be relying on your income or collateral (or both) when seeking approval for the loan?
- What kind of property do you have to use as collateral for the loan?
- How much equity is in the collateral property?
- What is the purpose of the loan?
- Exactly how much money do you need?
- What sort of monthly payment can you afford?
- How long would you like the repayment period to be?
- What would be your plan if you are unable to make the monthly payment?
Answering these questions will help you to better understand what loan terms would fit your needs and which ones would not. It is important to take out enough money for your purposes but also not to take out so much money that it might become a challenge to make the monthly payments. Again, sometimes a bad loan can leave you worse off than no loan at all, so don’t get caught in a situation that does not work for you.
Key 2: Find the Right Lender
Now that you’re armed with information about what kind of a loan you are looking for, you can begin your lender search. Finding the right lender is just as important finding the right loan because the same loan on paper can be become a vastly different experience in reality based on who your lender is. Fidelity Funding understands the important role the lender plays over the life of a given loan, which is why we are proud to have earned an A+ rating from the Better Business Bureau.
Key 3: Find a Lender Who Wants to Work With You
At Fidelity Funding, we know that our borrowers are the core of our business and that if our borrowers don’t succeed, we don’t succeed. Unfortunately, in the race to make as many loans as possible as quickly as possible, too many leaders lose sight of this basic fact about our business.
That’s why in finding the right hard money lender, it is very important to find a lender who wants to work with you: who wants to understand your goals and tailor a loan to your needs rather than just their own. We treat our borrowers like the business partners that they are, and you should make sure to find a lender who does the same.
Key 4: Find a Lender Who Understands the Local Area
One reason that potential borrowers seek out Hard Money Loans is that their situation does not fit the cookie-cutter, check-the-boxes approach that conventional lenders like banks often take when it comes to loan approvals. Because Hard Money Lenders have greater flexibility to examine applicants, their businesses, and their properties on a case-by-case basis to make their own determination, they are able to make loans where other lenders would deny the application.
However, being able to see these “diamonds in the rough” means that, if a hard money lender is to serve as an effective business partner, they must have a deep knowledge of the local area in which their borrowers live and/or operate. Without a detailed understanding of local real estate at the neighborhood level or of local industries and business trends, a lender is ill-equipped to gauge a good opportunity from a bad one and is less able to provide guidance or understanding when challenges arise.
Keep the Keys In Mind
These are just four keys to finding Hard Money Loans in Los Angeles, but, of course, this is by no means an exhaustive list of considerations you should keep in mind while securing the financing you need. One of the big advantages that Hard Money Lenders offer over traditional lending institutions like banks is greater flexibility in making unconventional loans that don’t necessarily fit into strict categorical definitions.
However, this greater flexibility also places greater responsibility on Hard Money Lenders to use their own judgment in gauging the prospects of a loan application. That’s why your choice of the lender can be even more important when it comes to Hard Money Loans than with a conventional bank loan. We know the importance of choosing the right lender. Contact Fidelity Funding today to see what we can do for you!
