Seven Things You Should Know About Commercial Hard Money Lenders

If you’re looking to finance the purchase of a commercial property, you’re probably well aware of commercial hard money lenders. In a commercial setting, hard money is capital offered by a private lender to fund the purchase, refinancing or rehab of commercial real estate. These loans vary greatly from traditional loans offered by banks and other financial institutions. With commercial hard money lenders nationwide offering local hard money loans with different terms and rates, no two hard money loans are the same.

Here are seven things you need to know about commercial hard money loans.

1. You can get a hard money commercial loan with bad credit or no credit history. Even if your financial history – or lack thereof – leaves a lot to be desired, you may still qualify for a loan with a commercial hard money lender. This is because hard money investing is asset-based, meaning the loan is focused on the viability of the property in question as opposed to your personal situation, history and experience. So, if you’ve been rejected by a bank due to your credit history, the good news is it’s not the end of the road for you. Hard money commercial property lenders, like us at Alpha Funding, may be able to offer you a hard money commercial mortgage that allows you to seal the deal.
2. Hard money loans can be secured fast. One of the biggest appeals of hard money for real estate is that it is able to be finalized quickly. So, if you need to act on a property fast and don’t have time to wait for the typical three to six-month turnaround time a bank usually takes, a commercial hard money mortgage might be your ideal solution. A hard money lender for commercial real estate may be able to get you your funds in a couple of weeks and sometimes even as quickly as a matter of days.
3. Commercial hard money can be used for a range of purposes. Hard money commercial loans aren’t just for financing the purchase of a property. You can also use them to refinance a property or to fund the costs of a renovation. Offering huge flexibility and with hard money lenders nationwide, you’re bound to find a hard money real estate loan that can be tailored for your situation. Opt for rehab hard money, a hard money refinance loan, a hard money bridge loan, hard money commercial mortgage or hard money second mortgage depending on your needs.
4. Commercial hard money can be used for a range of different property types. Commercial real estate hard money loans are available for a huge range of non-residential properties such as retail complexes, office buildings, condos, apartment buildings, industrial properties and warehouses. Generally, you can also use a hard money loan to fund the purchase, refinancing or rehab of unusual or more left-of-field property types. Loans from traditional lenders such as banks or financial institutions, on the other hand, tend to steer clear of creative properties and stick to projects that are safer. So, if the property you are investing in is not a typical property, borrowing with a commercial hard money lender may be the ideal way to close the deal.
5. Commercial hard money lenders offer varied and flexible terms. Since commercial real estate is so varied, commercial real estate hard money loans are typically assessed on a case by case basis. Accordingly, the terms and criteria attached to these loans vary greatly. Additionally, many hard money commercial property lenders offer flexible terms, so it’s always worth asking if something else will be better suited to your needs.
6. Hard money rates are typically higher than the rates of traditional loans. Generally, commercial hard money loans attract higher fees than more traditional loans from banks and other financial institutions. This is because this type of loan is considered to be riskier. Hard money interest rates are usually 4 to 5% higher than conventional loans, so keep this in mind when making your financial decisions.
7. Commercial real estate hard money loans come with their own set of fees. Like any kind of loan, securing a loan with a hard money broker or hard money lender for commercial real estate incurs numerous fees. For instance, you may be charged for appraisals or inspections done to value the property and you may also be charged documentation fees which cover preparing the loan documents you need to sign.

Real estate investors can leverage financing from commercial hard money lenders to purchase, refinance or provide rehabilitation to an existing property. In almost any economic environment investing in multifamily apartments or senior housing is a good strategy. Location is key along with the projected elevation of the specific area ( again location, location) in a micro real estate environment. Example: Finding the best area for multifamily locations within the Austin Texas area. Alpha Funding Corp provides multifamily bridge loans, apartment bridge loans and commercial non recourse financing. In order to serve you best the more detail you can provide in your scenario the quicker we can offer non bank commercial loan alternatives.

Ultimately, if you need money fast, don’t have a great track record or are looking to buy an unusual or somewhat out-of-the-box property, a commercial hard money loan is an efficient and effective way to fund your investment. If you’re looking for a hard money commercial real estate loan, check out Alpha Funding. We’re a commercial real estate hard money lender offering great financing options with competitive rates and terms. Find out more.