If you’re an investor – or anyone else – who’s considering a hard money loan, you’re probably wondering if you need good credit to get one. Here’s what you need to know.
Do You Need Good Credit to Get a Hard Money Loan?
A lot of people think that hard money loans are mostly for people who have bad credit – but that’s not true. A lot of people, including investors with sterling credit, use hard money loans to get fast financing.
You don’t necessarily need fabulous credit, either.
Hard money lenders are asset-based lenders, which means credit doesn’t matter as much as it would if you were getting a conventional loan. Sure, credit scores have a part to play when you’re getting approved, but a credit score isn’t always a deal-breaker.
The main thing a hard money lender is going to be interested in is the asset you’re borrowing against. That means if you’re buying an investment property, the appraisal for that property – as well as its after-repair value, or ARV – are going to be stronger arguments in your favor than your credit score will be.
If you’re not sure whether you’d qualify for a hard money loan, you can always call us to find out. We’ll be happy to talk to you about all your options, as well as explain how the entire process works.
Do You Need a Hard Money Loan?
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