If you're looking to take down investment properties and having trouble getting money from your usual bank, you should consider tapping into the private hard money market. Private lenders offer fast execution, reasonable terms, and the ability to close on deals that banks will not do.
Private loans come from investors like you. They seek to get a return on their investment by lending it out. In exchange for lending money out, they typically charge a market interest rate as well as an origination fee for the loan. Their loans are typically short term, giving you the time you need to acquire a property, rehabilitate it and either sell it or stabilize it as a rental and refinance it into traditional financing.
Since private hard money comes from individual investors, getting a loan is typically a much simpler process than getting one from a bank. You will need to apply, and you will probably need to get an appraisal, but that is usually the extent of the process. Once the private lender gets your complete application package they can approve it very quickly since they do not have a committee or a "boss" to answer to. Private hard money lenders can usually approve your loan less than two weeks and sometimes even faster.
In exchange for lending you money, private lenders typically require two things in return. First, they like to see a sizable down payment in the neighborhood of 40 percent of the total purchase amount. They are still willing to, in essence, take more than half of the risk on the investment, but they want to know that you are willing to commit your own resources to the deal, as well. Second, they will need to see that you are a good credit risk. Interestingly, they do not determine this by just making an up-or-down decision based on your credit score. They, instead, look at your total financial picture to determine if you are a good risk.
With some lenders continuing to be restrained about providing capital for investors like you, you need additional debt sources. Private hard money lenders make it possible for you to do deals, grow your portfolio and increase your personal wealth.