Time and tide wait for nobody and I guess we all are very familiar with this idiom. ‘Money’ is the reason we all are surviving and we don’t know when circumstances like this will occur when we will need some money desperately and we won’t be having a single penny. Thanks to our regular jobs that we are able to survive properly with our life and fulfill our basic needs but there will be moments when you will need some extra money and your payday will be far in sight. At that time you’ll realize the importance of Hard money and bridge loans.
People have varied misconceptions about money lenders which are baseless like money lenders utilize unfair practices. And they charge huge amount of interest. Believe me, like every other industry, even money lending industry is regulated by standards laws that keep a check on them and promote fair working of these money lending firms. But, if you feel some issues with your money lender, sensing any kind of unfair practices being used, you can always take legal help.
Before you file an application for any of these two loans, let’s get familiar with the terms ‘Hard money’ and ‘Bridge loans’
- Bridge loan: When you or your company needs money to set up the business but your company has some obligations, you can seek advantages from bridge loan. A bridge loan is a short-term loan taken until a company secures a permanent finance source. This type of loan allows immediate cash flow to meet the current obligations. Bridge loans are usually for a period of 2 weeks to 3 years depending on the kind of arrangement between the money lender and the borrower.
- Hard Money: Hard money is the second option for those who want instant cash flow to manage their current obligations. Hard money is a bit different from bridge loans, these are specific asset based loans. The borrower receives money from the lender which is secured by a real property as a mortgage. The lender will first evaluate the property and give the loan accordingly, equal to the value of the property.
General FAQ’s Related To Hard Money And Bridge Loan: Whether you’re borrowing money now or just doing some research for the unpredicted rainy days, there are few things you should know.
- Is there a difference between Bridge loans and Hard Money?
The answer is yes. There is a difference between the two terms, basically due to the money lending process that they follow. Bridge money is not secured by the property as in the case with Hard money. In Bridge money loans you need a high credit score to take a loan. N ow the difference between both of them is- In hard money, money comes from private investors whereas in bridge loan the money comes from a line of credits or the bank.
We hope this blog would help you a bit in clearing your concepts regarding money lending.