Most home buyers use conventional loans. Lending institutions lend money to buyers based on income and credit history. Hard money loans don't require credit scores and are more dependent on assets. It should not be confused that either one can replace the other. There are many loan options available for buying a house, but not all of them can be considered.
Hard money loans can be used for situations that are unique and often very difficult. Private investors can provide hard money to borrowers who are able to take the time and assess their entire situation in a way traditional lenders are unable. You can get hard money loans from a trusted Seattle hard money lender.
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Private investors understand that even if a borrower misses a few payments due to something like losing their job, it does not necessarily mean that the buyer can't repay his loan. This is an example of how hard money can work. Private investors can help homeowners who are so far behind in their mortgage payments that they cannot catch up.
Hard money loans have strict terms, which is why it's important to refinance as soon as possible. It is a costly, but valuable option that comes with an average interest rate of 10% to 18%. Rehab purchases are another reason to use hard cash in a market driven by foreclosures.
Hard money loans are not an easy option for people with poor credit. Private investors won't consider borrowers with past bankruptcy filings or non-payment. The hard money loan closing costs must also be paid upfront.