Private money loans are great investment tools for anyone that wants to invest in real estate and finds that conventional loans are unavailable or not their best option. Here are a few suggestions on where to locate the right and good money lender in Singapore :
- Mortgage Consultant
- Investment Clubs
- Real Estate Seminars
- Other Investors
- The Internet
- Family Member
- Financial advisors, CPA’s and accountants
Who are Private good Money Lender in Singapore?
Private money lenders are generally private individuals, hedge funds, institutional investors, portfolio lenders, real estate brokers, agents of REO (bank owned properties) or even a family member or friend that you may personally know. Private money investors will lend money to you on a short term, with a higher interest rate and some upfront fees. Points can range from 4 points to as much as 10 points. Private investors are more concerned about the equity in the property than your credit. If you have a property that you can show them has equity, and a strategy to pay them back, you should not have a problem locating a private money lender to help you.
Why Use a Hard Money Lender?
In tight financial markets like we are experiencing right now it may make more sense to seek out a private money investor. Why lose an investment opportunity because you cannot get traditional financing. A private money or hard money loan is normally a short term loan. Investors like these type of loans because they generally want money quickly so they don’t lose a profitable investment opportunity such as a pre-foreclosure or real estate foreclosure auction opportunity where time is of the essence and having cash available quickly is essential. Even if investors/buyers qualify for conventional long term financing, it may take too long to get and the deal may be lost by the time you get a conventional loan 30 -45 days later.
In the past couple years because there have been so many foreclosure losses incurred by traditional lending institutions,they have tightened their lending guidelines. Commercial banks are regulated by the Federal Reserve and have to follow strict rules and regulations with regard to lending practices. This creates much more red tape, delays and makes it more difficult for individuals to get loans or get them quickly. Although the government has been trying to ease up the tight credit markets this year with financial bailouts, there is still a lot of frustration in getting a loan and the process takes weeks. Many times you waste time waiting for a decision only to find out that your loan has been denied.