The rumor is that banks will tighten up lending even more in 2013 in the wake of fiscal uncertainty. Hard money loans from private money, non-bank lenders may be the solution for credit needs in 2013.
Hard money lenders in Utah and other States in the U.S. have had to fill the gap in lending since 2008, when banks all but shut down lending. Because hard money loans come from private investors and not from banks, hard money lenders do not fall under the same regulatory and operational requirements that banks are forced to comply with.
Particularly on commercial loans and loans for investment properties, banks will be playing it safe in 2013. Underwriting requirements for these loans have become almost unbearable. For this reason, many borrowers have turned to hard money lenders in Utah and other States to obtain loans for investment property purchases and refinances.
Because hard money loans are faster to fund than bank loans, many real estate investors are able to catch fleeting opportunities where a property may be deeply discounted or in distress.A word to the wise in 2013, don’t depend on your banker to come through. Although the interest rates charged by hard money lenders are a lot higher than a bank loan, it’s certainly better to have the funds available than to wait on the bank and lose an opportunity!!