Avatar's Blog
» Hard Money Lender or Broker?
Posted on 12/4/2004
Almost everyone claiming to be a hard money lender, on the web or in print media, is, in fact, a broker, not a lender. How do you determine the truth?
Look for words like "loan originator" or "loan origination specialist" - a loan originator is a loan broker. If you see that the firm does both brokering and lending, ask under what circumstances the loan will be brokered and under what circumstances will the loan be funded inhouse.
Look to see how the 'lender' is funded. If you see that a lender is institutionally funded, you have a real lender. If you see investor funded, you probably have a lender. Ask again, whether the lender will broker or "cooperate" with other lenders on some projects. These are words that means that your loan is being brokered - and points are added to it to cover those costs.
Posted in Miscellaneous
Look for words like "loan originator" or "loan origination specialist" - a loan originator is a loan broker. If you see that the firm does both brokering and lending, ask under what circumstances the loan will be brokered and under what circumstances will the loan be funded inhouse.
Look to see how the 'lender' is funded. If you see that a lender is institutionally funded, you have a real lender. If you see investor funded, you probably have a lender. Ask again, whether the lender will broker or "cooperate" with other lenders on some projects. These are words that means that your loan is being brokered - and points are added to it to cover those costs.
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