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Asset-Based Financing: Hard Money Loans Vs. Traditional Lenders

hard money loans in Los Angeles

Due to rigorous and stressful loan approval procedures, traditional lenders in California have lost a huge chunk of their property-based money lending business to diligent private financiers like PB Financial Group. Many prospective investors have turned to hard money loans in Los Angeles to fund their realty ventures. The following comparative discussion pro/cons hard money lenders and mainstream banking institutions in a bid to showcase the most advantageous.

Eligibility And Availability

Inarguably, hard money is the most readily available form of asset-based finance in the property market. Whereas traditional banks in California consider a myriad of factors, like your income levels, tax returns and your credit rating (FICO), before approving a loan, hard money lenders in Los Angeles are mostly concerned about the equity or value of your collateral property. All homeowners and commercial (corporations) with realty ventures in this region are eligible for hard money loan. This includes even those with terrible credit ratings like bankruptcies and/or foreclosures.


Compared to the cumbersome and hectic process of getting a traditional loan, hard money loan is simply the best because it is processed in record time. At PB Financial Group, a typical loan closes within 7-14 days. This means that hard money loans are the most appropriate for quick investment ventures like competitive real estate purchase bids.


As mentioned above, hard money loans are not encumbered or constrained by most of the regulatory guidelines that govern traditional bank lending. This means that in addition to easy eligibility and fast approval, this financing option offers limitless funding. The size of a hard money loan awarded is not determined by your creditworthiness; hence you can secure a huge sum of money provided that your collateral has adequate equity. You will also be able to get flexible/variable amounts to fund various project financing levels including subordinate 1st, 2nd and/or 3rd position loan options.


The last consideration is the cost of the loan as dictated by the interest rate. Presumably, hard money loans charge higher interest rates than traditional loans. They are expected to be relatively costlier due to their convenient approval and fast processing times. But in most cases hard money costs are the same or even cheaper than mainstream loans. Reason being that most hard money loans are offered for short-term financing whereas traditional lending usually goes to long-term projects. As such, the overall cost (factoring in time to calculate the total accrued interest) of a typical hard money loan is usually equal or lower than the cost of an ordinary long-term loan from a bank.

As you can clearly see from these basic facts, hard money realty loans work more toward your advantage than traditional financing sources. PB Financial Group will conveniently and cost-effectively solve all your real estate financial constraints. For further information or to schedule a consultation please contact PB Financial Group at 877.700.3703 or visit today.

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