The world of lending took a major turn for the worse for many businesses in the wake of the 2008 financial disaster. As new laws and lending requirements were crafted in response to that crisis, businesses suddenly found themselves having trouble obtaining the cash they needed due to more severe loan guidelines. Sadly, many could not even qualify for the smaller loans that used to be easy to obtain. As a result, many in Seattle, WA have turned to the private money lenders Seattle has in abundance.
Few industries are as dependent upon this type of capital as property brokerage firms. Many of the smaller brokers find it difficult to get capital quickly enough to win the deals they need. The slowness of many banks has left brokers standing on the sidelines as competitors grab up every good deal in sight. The problem is a simple one: for banks, the new federal regulatory structure makes it virtually impossible for them to provide brokers with ready access to cash in time for them to close their deals.
Fortunately, private loans can fill that need. This is possible due to the fact that such loans are offered using different rules than banks, meaning that the qualification standards used for borrowers are less intense. Since capital is provided by funding companies and investors, there is a greater degree of liberty in who they can lend to and how quickly those loans can be processed.
There are, of course, licensing standards that must be met, and these lending sources are not free from all laws related to loans. Where they benefit is in the reduced amount of regulation they endure when compared to banks. This lower regulatory burden makes underwriting far easier for these investors than it is for most loan officers in the banking world.
With this funding source, brokers have the ability to make deals while knowing that the funds they need are available to them. With that credit line in place, the time involved in the average transaction is dramatically reduced, and that can empower borrowers to make the timely deals that sometimes earn them discounts on the prices they pay.
In addition, these loans usually require no credit checks, making them a much more accessible funding mechanism for new businesses that may lack the established credit needed for bank loans. That can also benefit borrowers who may have experienced recent credit score reductions or other problems that would usually preclude a typical loan.
Given the nature of this type of loan, it should come as no surprise that investors tend to charge a higher rate of interest than the typical bank. Still, that added cost is negligible when compared to the greater number of quality deals and discounts that become available to brokers using this funding source.
What is clear is that every real estate broker can benefit from the many advantages offered by this non-traditional funding mechanism. The positive aspects of these loans more than outweigh the minor increase in interest rate costs, making it perhaps the best option for brokers struggling to obtain standard bank loans.
Few industries are as dependent upon this type of capital as property brokerage firms. Many of the smaller brokers find it difficult to get capital quickly enough to win the deals they need. The slowness of many banks has left brokers standing on the sidelines as competitors grab up every good deal in sight. The problem is a simple one: for banks, the new federal regulatory structure makes it virtually impossible for them to provide brokers with ready access to cash in time for them to close their deals.
Fortunately, private loans can fill that need. This is possible due to the fact that such loans are offered using different rules than banks, meaning that the qualification standards used for borrowers are less intense. Since capital is provided by funding companies and investors, there is a greater degree of liberty in who they can lend to and how quickly those loans can be processed.
There are, of course, licensing standards that must be met, and these lending sources are not free from all laws related to loans. Where they benefit is in the reduced amount of regulation they endure when compared to banks. This lower regulatory burden makes underwriting far easier for these investors than it is for most loan officers in the banking world.
With this funding source, brokers have the ability to make deals while knowing that the funds they need are available to them. With that credit line in place, the time involved in the average transaction is dramatically reduced, and that can empower borrowers to make the timely deals that sometimes earn them discounts on the prices they pay.
In addition, these loans usually require no credit checks, making them a much more accessible funding mechanism for new businesses that may lack the established credit needed for bank loans. That can also benefit borrowers who may have experienced recent credit score reductions or other problems that would usually preclude a typical loan.
Given the nature of this type of loan, it should come as no surprise that investors tend to charge a higher rate of interest than the typical bank. Still, that added cost is negligible when compared to the greater number of quality deals and discounts that become available to brokers using this funding source.
What is clear is that every real estate broker can benefit from the many advantages offered by this non-traditional funding mechanism. The positive aspects of these loans more than outweigh the minor increase in interest rate costs, making it perhaps the best option for brokers struggling to obtain standard bank loans.
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