Why would one seek an expensive hard money lender rather than a conventional bank?
Time Restraints – Conventional banks generally take longer to close. They require a long due diligence period that the borrower may not have due to an approaching settlement or foreclosure sale date. Hard money loans can be closed on in as little as 1 week. Credit Score or Bankruptcy – Credit Score is too low, or Pending bankruptcy is not up to an conventional bank’s standards. Type of Collateral – Conventional banks generally only lend on certain types of collateral. If the borrower owns or wants to buy a property that does not meet conventional bank’s standards, then hard money may be the only option for the borrower.
