Factors for Evaluating Whether a Loan is for a Business Purpose

Factors for Evaluating Whether a Loan is for a Business Purpose

Part 1 of 2 – Federal factors. Although lenders are perhaps more familiar with the regulations involved in making loans to consumers, it is important to keep in mind that different rules apply to business purpose loans secured by real property.  The first step in the analysis is, naturally, to determine whether the loan is a business purpose loan, or a consumer purpose loan. In Part 2, we will examine some of the state considerations.  Part 1 we focus on some of the federal considerations, starting with the Truth in Lending Act (TILA).  Along with its federal...
Keeping Things Interesting – How Federal Interest Rates Work

Keeping Things Interesting – How Federal Interest Rates Work

To anyone who has ever had a credit card, borrowed money or deposited money in a savings account, you know firsthand how interest rates impact the amount of money you have at any given time.  A somewhat complex system directs how interest rates are set at any point in time.  If you’re interested in how federal interest rates work, this information will help you. How Do Interest Rates Work? Interest rates can be thought of as essentially the price of borrowing money.  It is the amount charged by a lender for use of an asset, expressed as a percentage of the...
All Hard Money Lenders Care About Is Equity

All Hard Money Lenders Care About Is Equity

There is a huge misunderstanding by clients when they call thinking they can get a hard money loan just because they have equity. Sure, hard money lenders are mainly equity based lenders and lend base on the collateral’s equity position. The more equity the collateral has, the more the lender is protected, but that doesn’t mean money is lent solely based on equity. There are other factors considered before money is lent: ONE Does the client have the ability to repay the loan? There are many ways we verify this and it doesn’t necessarily follow the conventional...
Myth: Hard Money Lenders Are Predatory

Myth: Hard Money Lenders Are Predatory

Sure, there are some bad apples who overcharge clients and take advantage of special circumstances clients tend to find themselves in like getting a decline from their conventional lender three to four days before escrow has to close or having their home a few days away from a tax sale auction. But, not all lenders are created equal 😊. As a hard money lender, I can attest to doing a lot of good for clients who have been rejected by institutions who can care less about their situation and what lead them to the position they are in. Banks want the three things to...
Cannabis Lending: Marijuana Loans for the Hard Money Broker

Cannabis Lending: Marijuana Loans for the Hard Money Broker

Do you remember when your parents said your love of marijuana would get you a first-class ticket on the road to nowhere? It turns out they were wrong. These days, that skunky pot odor translates into the sweet smell of success thanks to the booming cannabis industry. You just need to get a marijuana loan to open a business, then you can start raking in the profits. Considering that marijuana is a $2.75 billion industry in California, those profits can be huge. There is one problem though, and it could cause your entire plan to go up in smoke. You don’t have the...
Questions To Ask Your Lender

Questions To Ask Your Lender

There are many factors that come into play when shopping for a mortgage. For some, their interest lies in the size of their monthly payments, however, from my experience I find that the majority look for the lowest interest rate. Now, for someone venturing through this process, there are several common questions that come to mind that you should discuss with your lender. Let’s take a moment and address them one-by-one before you consider signing on the dotted line. What kind of interest rate can I get? Of course this is one of the most common questions one would...