What is Commercial Hard Money Lending?
With a commercial hard money loan, underwriting decisions are based on the borrower’s real estate assets. Such loans are also called “no-doc loans”, “private hard money loans”, etc. For a commercial hard money loan, the lending decision is based on the “commercial asset” as opposed to relying heavily on a borrowers’ credit, financials, etc.
By relying on an asset, private lenders are able to fund transactions that might not fit traditional lending guidelines. Private Lending Group is a unique lender in the hard money space. We are a direct lender and lend our own funds; our money lenders underwrite in-house without any upfront fee. This allows Private Lending Group to provide honest answers quickly without the thousands in out-of-pocket expenses typically required for a commercial real estate loan (appraisals, etc.).
How is Commercial Hard Money Different from a Bank Loan?
The following table summarizes the key differences in loan characteristics between a conventional bank loan and a commercial hard money loan from Private Lending Group.
Private Lending Group Commercial Lending
Basis for Loan Approval
|Income, credit score, tax returns, financials||Real estate assets|
Minimum FICO Scores
|Typically 700+||580 (or case by case)|
|Significant||Minimal on the property|
|Inspections, appraisals, application, etc…||No upfront fees|
We make the decisions directly
Loan Money Received
|2-3 months||Less than 10-14 days|
A commercial hard money loan is a good alternative to traditional bank financing. This alternative financing can be very beneficial to the borrower in many circumstances. Below are just a few of the reasons for when a commercial hard money loan might be appropriate.
When is a Commercial Hard Money loan appropriate?
- You need a loan quickly and can’t wait the 3 to 6 months for a traditional bank loan
- You do not qualify for traditional financing for whatever reason (income, tax returns, unique property, etc.)
- Transaction falls out of traditional lending parameters
- Your credit is impaired
- Although you have ample equity, you or your property have liens, judgments, unpaid bills, etc. that requires cash to resolve
- You have ample equity in your property and need cash fast
- You need business working capital
- Your property is occupied by your business and your financials don’t tell the full story
- You need a loan without all the documentation requirements of a bank
- You are trying to avoid foreclosure and restructure your debt
- You are a foreign national
- You need a complex loan with multiple pieces of collateral
- You need a creative solution to a loan that doesn’t fit other lenders
Lending Not Offered in The Requested State
Unfortunately, we do not provide loans in this state.
Owner Occupied Properties
We provide loans for investment properties, and cannot lend to owner occupied properties.
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