Unlike conventional lenders where you might work with a different employee on each visit or loan, working with a hard money lender is as much about forging a relationship as about obtaining financing for a commercial real estate (CRE) investment. There are six qualities that you as a borrower should look for in a hard money lender whom you wish to work with.

1. Communicative. This is important because most CRE deals are time sensitive, so whether the answer is “yes” or “no,” it’s better to find out sooner than later. A respectable hard money lender will respond to your loan request in days, not weeks. This is also an important quality for a borrower as quickly responding to any questions or requests from your lender will materially speed up the approval and underwriting process for your loan application.
2. Diligent. As a borrower, you want a lender who will be diligent about looking into all aspects of your application before approving it. This ensures that there are less likely to be any surprises at closing or after the loan is in place for you or your lender. Diligent and reputable hard money lenders will only approve loans on deals they feel will prosper and for borrowers they believe will repay; they don’t want the trouble of having to foreclose on a property to recoup their investment.
3. Local. A hard money lender located in the same market as the property is always a safer bet than a national lender. It will be easier to verify the reputation of a local lender than one located in a different state. Local lenders have reputations to maintain in their communities and won’t last long if not utilizing upstanding business practices. Completing an internet search of the lender is always a good idea and/or calling local real estate professionals for a reference.
4. Adaptable. As with hard money loans, hard money lenders differ from their conventional counterparts by being willing to adapt their loans to fit situations in which they and their borrowers can take advantage of opportunities that will yield substantial returns on both their investments. A hard money lender with creativity will be able to assist a borrower whose deal is atypical but full of potential by structuring the loan to fit the deal rather forcing the deal to fit the loan.
5. Trustworthy. When building a relationship with a hard money lender, it’s important to keep long-term goals in mind alongside your short-term financing needs. Good lenders want to work with borrowers who will bring them deals that are win-win situations for both borrower and lender. Borrowers want to work with lenders they can trust to offer them competitive terms.
6. Practiced. This quality goes hand-in-hand with the previous five as a lender with the other qualities will by necessity have become experienced in this industry. Conversely, experienced lenders will have honed the other five qualities mentioned. For example, they will be more likely to notice red flags that indicate potential pitfalls when evaluating properties and more accustomed to approaching loan structuring with creativity.

With 45 years of experience in hard money lending, Montegra epitomizes all six of these qualities. We respond to loan requests within 24 hours, offer competitive terms and structuring to fit individual situations, and when you deal with Montegra, you’re dealing directly with the decision-maker. Montegra has a stellar reputation in the Colorado real estate community and is committed to responsible lending practices.