Out there hard money lenders will give you loads of advantages of hard money loans and never talk about the disadvantages. I have captured some of the major advantages and disadvantages of hard money loans.
Advantages of Hard Money Loans in GA
• Documentation is Easy
• Processing is Faster
• They are not as strictly regulated as banks and mortgage lending institutes are
• Less tedious procedure
• Bigger spectrum of loan types
• The credit record of the borrowers is not a major criterion
Disadvantages of Hard Money Loans in GA
• Hard money rates are more than the bank rates. Usually it will be 3 to 6 percentage points above the bank interest rates for real estate. In some cases where the risk of loan default is more, the interest rate could be as high as 21%
• Hidden charges
• Most of the customer protection regulations are not applicable
• Some hard money lending companies charge up to 2% to 6% of loan amount as processing fee or upfront points
About Hard Money Lenders in Georgia practices:
Hard Money Lending services are mainly restricted to major cities and towns. In smaller towns raising hard money is difficult. Some of the common difficulties are lack of valuators in the area, assessing true value of the property due to lack of references in the area.
