Hard Money Business Loans

Business owners with bad credit often have a very hard time getting the credit they need to keep their enterprises afloat.

Traditional lenders such as banks may not make regular loans available to such businesses. Alternative financing such as cash advances and credit cards can be expensive.

One alternative that businesses with bad credit should investigate is hard money lending.

What is a Hard Money Loan?

A hard money loan is a direct loan made from an individual or company to a borrower. Since such loans are not made by banks they don’t have the requirements of bank loan.

Hard money loans generally have higher interest rates and have to be paid back fairly quickly. The advantage to hard money loans is that can be gotten quickly and are less restrictive.

The disadvantage is that hard money loans will have higher interest rates. Borrowers may also get less time to pay them off.

Qualifications for a Hard Money Loan

Hard money lenders are interested in hard money; actual cash, not figures or projections. That means that a hard money lender may lend to a business with bad credit that has a high cash flow or a good business plan.

To get a hard money loan a business will have to produce evidence of cash flow such as bank statements or sales receipts. It should also have a professional looking business plan available.

Hard money lenders might also take a note on real estate, equipment, vehicles, accounts receivable or inventory as collateral for loan. To use such things as collateral for a hard money loan there will have to be no other debts on those items.

Where To Find Hard Money Loans

The best place to find hard money loans is online. Simply typing hard money loans or hard lenders into a search engine will produce a list of hard money lenders.

There are several websites that connect businesses with hard money lenders such as www.Ibank.com . These can provide an entrepreneur with a list of reputable hard money lenders.

When To Get A Hard Money Loan

A business should only take out a hard money loan when the business owners think they will have the cash to pay off the loan in the near future. If there is any doubt that a business will be able to make enough cash to pay off the hard money loan don’t take out such a loan. Hard money loans are only for those who have the hard money to pay them with.