How Hard Money Lending Helps Development

Hard money lending is a term that refers to private lending. It is useful for developers and investors that need short term financing for local projects, need funds quickly, or are working on a property with few other financing options. It is common to see this type of financing in new construction, condo conversions, and land acquisitions.

Benefits of Hard Money Lending

The needs of investors and developers are very different from that of typical property owners. Most require funds quickly and only for the short duration of a particular project. It is not unusual to find hard money loans for 6-month or 1-year terms. Hard money loans can often close in a short period of time due to the simplified qualification criteria.

Lending Criteria and Terms

Hard money lenders focus more on the property and situation (as compared to the borrowers finances in typical owner occupied home loans). It can be a great resource for investors with glitches in their credit or for difficult to finance properties (such as those in heavy disrepair). Closing costs (i.e. points) and interest rates are normally much higher for these loans as compared to long-term loans for owner occupied residential properties, but investors still realize a profit after the loan is paid off.

How Hard Money Lending Helps Development

Hard money lending is a valuable resource for local investors and developers. Borrowers can avoid the scrutiny and lengthy underwriting process of large banks and instead get funding based on the merits of the project or development. These loans can therefore enable projects to move forward that may otherwise not get done. If you have a project and need hard money lending, consider Atlas Funding. We are one of the major private lending firms in Massachusetts.