Private Lending for Hard Money Loan Programs

When you need cash quickly, trying to get a traditional loan from a bank may take too long and will not guarantee funding. If you are looking for a better way to receive expeditious funding for an important project in Phoenix, a hard money loan from Summerlin Financial may be a good option for you. As a short-term loan option, hard money loans have a few significant benefits.

 

How Does a Hard Money Loan Differ from a Traditional Loan?

When you apply for a traditional loan, most banks and lenders scrutinize your debt-to-income ratio, credit score, and employment stability to ensure your ability to pay back your loan in full. Hard money is more often based on the value of the collateral you use to secure the loan. Therefore, your cash flow is less important because the collateral can be sold to recuperate the losses of the lender. Hard money loans tend to be short-term loans, in part due to higher interest rates than traditional loans. However, this should not be a surprise when you search for higher-risk loans that require less paperwork and have more flexible terms.

 

How Do Hard Money Loans Work?

The underwriting process differs from lender to lender. Most hard money lenders look at applications individually and offer funds on a case-by-case basis. The amount an applicant receives is based on a loan-to-value ratio set by the lender. For an LTV of 50%, the loan amount will be half of the value of whatever assets are used for collateral. Summerlin Financial, Inc made the process even easier with a three-step process for securing a loan.

• Submit a signed purchase contract
• Underwrite loan
• Loan funded

Summerlin Financial, Inc makes it fast and simple for you to secure a hard money loan for construction, commercial projects, land and lot transactions, and fix and flip projects. Some loans may be approved and funded in as little as 24 hours with no credit check or tax information required.

Conventional loans are generally the most common loan program in the industry. These loans are not insured by the federal government and are funded by private financial lenders. 

 

This loan program may attractive to applicants because depending on the down payment percentage, there is no mortgage insurance. Additionally, if your loan does have mortgage insurance, on a conventional loan, it will drop off once a certain amount of equity is reached. 

 

Conventional loans will require a higher credit score and lower debt to income ratios and can finance a wider range of properties when compared to a government loan like FHA. 

We offer low down payment conventional loan programs to those who qualify called Home Ready or Home Possible loans. The down payment requirements may be lower than an FHA loan. 

 

These loan programs are designed for low and middle-income borrowers and offer low down payment, low fees, and low mortgage insurance requirements. 

 

If you are looking to finance a primary residence, a Home Possible or Home Ready mortgage might be the perfect fit.