Hard Equity Loan: Is It for You?

Loaning processDo you need some ready cash to pay for your mortgage or car loan down payment but you’re stuck with bad credit? Or worse, you just don’t qualify to apply for all possible loans? Try your luck with hard equity lenders in Miami

Hard equity loans are loans that you can avail when all else fails. Private lenders offer them to those who can’t avail loans provided by commercial banks or other lending institutions. Banks or most financing firms don’t provide these types of loans.

For whom?

A hard equity lender would normally have clients who have no chance to qualify, no time to secure a traditional loan, no income or assets, low or bad credit scores, or high debt ratios. Such loans may also be for those making a quick or emergency purchase, or simply those who can’t obtain loan approval.

Hard equity lenders offer loans with higher interest rates compared to traditional loans. They may charge as high as 15%. The “sub-prime” feature of hard equity loans makes them very risky; hence, the private lender’s only protection is to charge a high-interest rate to offset such risk. Accordingly, the private lender requires strict terms and conditions. They tend to ask between 30% to 50% equity of the appraised value of a client’s home.

How’s the loan process?

Hard equity loans are very easy to avail. The lender would do most or even all of the loan processing. As such, the borrower would only need to wait for the lender to complete relevant processing tasks. There is no verification of the mortgage or even the income or assets of the client, much less the debt history. So, there is no need to calculate the debt ratio or the credit score.