The current global financial meltdown had lead to the increased of the major importance in the utilization of the private lender in your real estate investing business. There are actually a lot of those investors that look into private investor lending to be an economically viable option in order to support that of their real estate transactions.
The private lender will charge few fesses as compared to the hard money lenders. The private lenders will not charge for points as compared to the hard money lenders that will charge right between three to six points into the total amount of the money that is being borrowed.
The private lending actually has a lot of advantages in terms of the field of real estate development.
The first advantage is that it will offer less paperwork. This is actually the first advantage that is being offered by simply utilizing the private money lender. The paper works can involve such kinds of transactions which can be minimal. Only some few documents are being involved in this kind of transaction like the promissory note and the mortgage, as well as the insurance binder listing
The second advantage is that it is cost-effective and very simple. The simplicity and the cost-effectiveness of this procedure had made it famous and one of a kind. There is actually no other cost that can be involved here in the deal other than that of the closing fees for the purchase of the property as well as the recording fees and the title insurance too. You have to make sure that you are going to assess the true value of the property prior to approaching that of the private lender. The title research of the property is very much essential and it has to be properly recorded with that of the mortgage. All of this is enough for the private lender to consider that of your proposal for the financing.
The third advantage is that it has low fees. There can be no high bank risks that can be involved in terms of private money lending. The total cost is actually being kept low by those that are keeping the procedure simple. The private lending is actually cheap as compared to those hard money lenders and to that of the charges of the typical bank for such kind of transactions.
This can offer also quick approval of the loans. The private lending is very quick in terms of meeting the critical demand of those borrowers that are bound by the time limits. They can also be able to help in carving out an edge into the global competition and it makes it a good way for the lender to choose into. This is the reason why a lot of people will opt for this since this can have fast approval and this will not ask many documents anymore to the clients since they had been in the business for quite some time already and they are well trusted by the people.