Hard money lending in Washington D.C. has started booming in recent years thanks to the popularity of real estate. There are many reasons for hard money lending’s popularity, mainly that it does not require the financial history and credit scores of traditional loans.
Like all loans, though, hard money loans require knowledge to make good decisions because they can be risky. To help with that knowledge, I talked with Hard Money Bankers. Hard Money bankers is a hard money firm with vast knowledge of the D.C. area.
They’re trusted by many expert real estate investors and have helped propel the careers of countless entrepreneurs. Hard Money Bankers agreed to share five tips for Hard money lending in Washington D.C., and now I’m going to share those tips with you!
This tip is not specifically for Washington D.C. but for hard money loans in general. Hard Money Bankers insist that everyone should know the risks of hard money loans.
The benefits are pretty obvious. The loans are easier to get and much faster. There’s less yellow tape to workaround to get your money and start investing. And hard money loans are a fantastic way to start off your investment journey if you have no credit or real estate history.
However, most of the time, they are also more expensive, with higher interest rates and closing costs. They are still a great option, but knowing the pros and cons is important.
Washington has a couple of options available for certain people that are looking for housing loans. Veterans can look into VA loans, which were created for qualified veterans and backed by the Department of Veteran Affairs.
As far as credit goes, they have a much lower barrier to entry and are less risky than a traditional loan. There are also FHA loans from the Federal Housing Administration, which also have a low credit barrier and do not care about previous bankruptcies.
Your options for hard money lending in Washington D.C. will vary quite a bit depending on your timeline. Hard Money Bankers says that just like them, there are some hard lenders in Washington D.C. that can process your loan in under a week. However, you’re going to be looking at more fees or higher interest.
So, knowing your timeline beforehand will help you understand whether you should accept those fees for the faster timeline or look somewhere else and wait the average week and a half for your loan.
If you’re a real estate investor looking for hard money loans to fund your real estate deals, you want a hard money lender in Washington D.C. that deals solely with D.C. Not a lender that works with D.C. and 12 other nearby cities.
This is because D.C. has its own laws and regulations for property and real estate. If you’re taking out a loan for a property, your lender will want to inspect that property.
If they’re a D.C. lender, then they will know a lot more about the property and its potential, which means you can get your loan much faster.
This is another tip that isn’t D.C.-specific. Hard Money Bankers insist that you look for a hard money lender in Washington D.C. that is 100% transparent.
Read all of your contracts, take note of any shady behavior, and watch for red flags. It’s probably a good idea to keep a lawyer on hand for help understanding contracts.