What is the difference between a private money lender and a hard money lender? Usually a private money lender is an individual or group of individuals, whereas the hard money lender can be an individual, a company, or formal group of investors. However, essentially there is no difference in their processes.
Private money lenders from Louisiana
with which I am most familiar usually talk to perspective borrowers through phones or in person. They tend to ask for various types of information.
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Such things as the reasons for borrowing, details about the investment, a detailed business plan, and the income of the borrower are not uncommon requests.
Many people who have tried and failed to attain financing or loans from the banks can turn to private lenders. Often, if the investment is reasonably sound, the private money lender will agree to provide the money.
It must be noted that the interest rate charged by private money lenders is usually extreme. I have seen private money lenders for Louisiana charge anywhere from 15-30% on their investment over periods as short as months, and some as long as a few years.
Money lenders typically provide cash for real estate transaction. Many times the potential buyer is interested in purchasing a property at a discount and plans to turn a profit form the property in a reasonably short time. As a result the lender will get his or her investment back plus a healthy interest rate and the borrower will be able to turn a property into a profit.
In such a case both parties come out winners.
Some of the highest ranked private money lenders for Louisiana are looking for borrowers right now.
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