If you are confused about what hard money is and what kind of loans you can get, you will want some of this information about hard money commercial loans.

If you are wondering what “hard money” is, it is usually defined as fast cash: non-conventional or private financing with private funds. Because hard money loans are not usually backed up by governmental safeguards, the stringent guidelines and documentation required are missing. Therefore, it is relatively easy to qualify for one.

There are several reasons that hard money commercial loans originated, but they all go back to the consumer’s need for private financing. First, properties are difficult to fund, especially things like vacant lands. Second, if you have bad credit problems, the poor credit history will lead to a poor FICO Score. Third, if there a balloon payment due you must refinance before that is due. Next, if there is not documentation required you can not verify your income. Lastly and most significantly, these loans allow individuals to get emergency cash quickly with no stringent underwriting guidelines.

A FICO Score is a complex matrix that measures over 30 different variables in an individual’s credit profile. The FICO system translates the profile into the numeric score that is found in credit reports. That score is then a reflection of the computer assigned credit risk for the individual in question.

Private investors provide hard money commercial loans because most private investors understand the real estate market. They are always looking for a safe and secure investment with a rate return of superior to that offered at banks or in the stock market—namely, the type of investment provided by real estate. Because these loans are secured by a property’s Equity, the investor is protected and receives the advantage of higher Interest rate return along with the origination Fees.

To get a hard money Commercial Loan you can go online to any business that offers them and register. You will then post your loan request and monitor your home age for sealed-loan bids in a real time format. You can then choose the lowest bid that is most appropriate for you.

There are a few special programs that exist to help you and anyone else who is looking to buy commercial property. Most lenders will provide a loan with the funding amount based on the proposed or appraised value of the property, rather than the sales price. You should find a plan that will help you locate and examine the variations in all your potential hard money lending options.

Types of hard money commercial loans:

An acquisition loan is used to acquire property using the loan proceeds. Such a loan can be used for anything from the purchase of improved lots to the purchase of completed and operating property, and is available in amounts from $300,000 to $50,000,000.

Acquisition & Development are hard money commercial loans to together acquire and expand real property to an improved state. Voucher control is acquired to scatter loan proceeds with interest only paid on funds dispersed. Loan to value is determined as to the improved value for $300,000 to $50,000,000.

Asset loans are for any purpose whereby collateral is put up for security in the amount of $300,000 to $10,000,000

Bankruptcy loans are also called "Debtor in Possession" financing, and may be used on real property assets until institutional financing is available or sale of asset. Available in the amount of $300,000 to $25,000,000

A Bridge Loan is a loan that is for a short period of time, and is meant to last just until permanent financing takes place. Bridge loans provide the means for investors to gain a timely acquisition or business opportunity because they allow the borrower to act quickly. These loans can be used for acquisition, buy-outs, foreclosures, cash out, and construction purposes.

Types of properties for which these loans may be used include income producing property, commercial, apartments, hotel/motel, office buildings, office complexes, golf courses, and almost all commercial businesses. Short-term loan programs between 6-24 months are available from $300,000 to unlimited amount.