Bad credit can affect your life in many ways. You can especially feel the crunch when you want to take hard money loans to finance a project. In the past, you could have relied on hard money loans to bail you out if bad credit disqualified you from getting loans with traditional lenders. Today, it is difficult to get hard money loans from commercial lenders. However, it is still possible to get loan facilities elsewhere. The most important thing to do is to find best hard money loans in the aftermath of the credit crunch of 2008 and beyond.
Many people have ceased wondering whether their bad credit can prevent them from getting hard money commercial loans in the current market. The more important question would be who among the money lenders can provide the best conditions for lending you the money in spite of your bad credit history.
You can find a hard money lender that is more concerned about other issues rather than your personal credit. They would rather focus on your income and on whether you are in a good position to repay the loan. They can also focus on the equity that pertains to the property that you used to secure the loan.
The issue here is complicated because people are redefining what it means to have bad credit after the credit crunch that left many people with bad credit. Many of those left with bad credit had previously good credit and they paid their debts faithfully. The credit crunch caught many people unprepared. Hard money lenders can therefore consider your credit good if you showed evidence that you were willing to pay your debt under those difficult circumstances.
Since the bar for bad credit has been shifted, you have a greater opportunity of getting your application accepted even if it had been turned down before. It will be easier for you to find best hard money loans if you have between an average and a good credit score.
The limited funds that hard money lenders have might prevent them from lending to more people than they do. That is why they have to be selective on whom they lend to. The competition is getting stiffer, forcing you to have among the best credit scores among those people whose applications have been previously turned down.
If you do not have average to good credit score, you will be among those considered later after the good ones have been offered the money. You would be lucky to get a hard money loan. However, a lender would be willing to consider you if your income is high and the equity on the property used for securing the loan is substantial.
This comes down to the laws of demand and supply. The probability of you getting a hard money loan decreases as long as there are other people whose credit scores are good. The availability of funds is another factor. If you are determined to get a hard money loan, you should ensure that you directly approach a hard money lender with a good reputation. If you experience any trouble in finding such loans it could be a signal for you to begin the process of repairing your personal and business credit.
When you want to find best hard money loans, you should consider the fact that such loans are expensive and they are available only for a short term. Slowing down and using alternative financing can help you reduce the burden of paying your debts and building good credit.
However, if you need money very urgently, you can turn to hard money loans especially if you have a solid property and there is enough equity and cash flow.