September 26, 2018 1 min to read
Three Things that You Probably Don’t Know about Hard Money Loans
Category : Insider
In an ideal world, most people would live debt-free all their lives. However, in the real world, life happens, and the need to take a loan is unavoidable. You have many options through which to get a loan to settle your financial need. You can visit a lending agency like Monroe Funding Corporation. If you are considering this option, here are three interesting facts about hard money loans:
They Are Different from Bank Loans
A hard money loan is secured by real property. The lender assesses risks differently from the way banks do when giving loans. Also, the documents required for the credit are different. A hard money lender has to be more creative while creating the ideal solution for you. Your lender will explain the application process clearly, so you need not worry about anything.
The Monthly Payments Are Quite Manageable
The majority of hard money loans tend to be interest-only payments. What this means is that you only pay the cost of taking the loan each month without paying any of the principal. This makes it so much easier to make payments every month, something that isn’t usually possible with other types of loans.
There Is a Balloon Payment
Since hard money loans are interest-only payments, you don’t get to touch the principal until the end of your loan term. That’s when you clear the entire principal in one large payment, also known as a balloon payment. You can opt to refinance the loan or sell a property to fulfill that obligation.
When in need of financing, you can apply for a hard money loan. In light of its benefits, it’s clear why so many people opt for it.