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» Hard Money Loan Exit Strategies
Avatar Financial Group funds hard money commercial bridge loans. A bridge loan is a loan that spans a short period of time and 'bridges' a gap between now and approximately 12 to 36 months at which time the loan comes due in full.
If you are seeking hard money because your credit scores prevent you from obtaining a conventional loan, you can list 'clean up credit and refi' on your loan application. This is perfectly fine, but you have to have a clear plan in place to do that. Can you afford to pay off debts with the proceeds of this loan and then negotiate with lenders to assist you in clearing your credit scores? Will you hire a professional to 'clean up' errors that are currently preventing you from obtaining a loan?
Will you sell the property and repay the loan that way? Are you simply in a hurry to complete a sale and already have long term financing underway as you accept the hard money loan?
Whatever the reason for obtaining this bridge loan, recognize that the loan will come due within 36 months at the outside and prepare immediately for refinancing. With the best of intentions, it often takes much longer than expected to clear credit issues, prepare a building/property for commercial bank approval, or sell a property. On your loan application, show that you ready to move quickly and efficiently to complete your exit strategy in a timely manner.
