Hard money acquisition loans are frequently taken out by parties who want to purchase properties at below market prices and then resell them at a profit. Other uses of this type of loan are to buy a “fix and flip” property, or use it to purchase a property that can be converted to condominiums and then the condos can be sold for higher prices, thus providing a profit opportunity to the borrower.

The process of getting a hard money acquisition loan is straightforward and quick by design. After contracting for the purchase of a property, the borrower contacts the lender. The lender analyzes the pending purchase. The lender and the borrower then work together to create a loan structure that will allow the borrower to maximize their gain on the property.  Private capital lenders who provide these hard money acquisition loans  are more willing to offer flexible terms that work for the borrower than institutional lenders.

Because they are funded by private capital lenders, these hard money acquisition loans are faster to obtain than traditional bank loans.  Private lenders are able to use “common sense” to make their loans while banks are strictly regulated by various Federal agencies that create unnecessary red tape for the banks.

Who Typically Needs Hard Money Acquisition Loans In Denver?

Hard money loans are often taken out by real estate investors with promising opportunities in front of them, and who need to secure financing expeditiously. A hard money loan allows them to acquire the capital they need to purchase, rehabilitate, renovate, or build on the property for quick resale. Without the usual red tape of traditional lending, the process moves more swiftly.

These hard money acquisition loans  also offer options for investors with relatively  poor credit histories. Hard money loans are primarily secured by the real estate—not the borrower’s financial statement or credit score.  If the borrower can afford the terms, interest rate, and repayment schedule of a hard money acquisition loan, it offers an excellent opportunity to get their deal done.

Benefits Of Colorado Hard Money Acquisition Loans Over Traditional Loans

For investors looking to secure capital promptly, hard money acquisition loans in Denver have many advantages over traditional bank loans.

• Faster turnaround for approval and receipt of funds. Hard money loans are  frequently approved within a day or two. The borrower may receive their funds within a week.
• Fewer borrowing requirements. Hard money loans are backed by real estate acquisitions. Borrowers’ financial status and credit history aren’t as important in the underwriting  process. Real estate is the primary collateral.
• Faster closing on property transactions. Real estate transactions can be held up by  time-consuming approvals, paperwork, and waiting periods of traditional bank lenders.  Hard money loans can be approved and issued within a week, which makes closing a pending transaction a much easier process.
• Establishing working relationships with lenders. Career investors who take out hard money loans—and regularly meet the repayment requirements—build familiarity and trust with their lenders, which makes it easier to obtain more capital from them down the road.
• Convenient for those starting in real estate. New investors often don’t have sufficient capital or credit to take out traditional loans. Hard money acquisition loans can help them get an instant foothold in the business of real estate investing.