No Credit Check Hard Money Lenders: How Can the Financially Disadvantaged Benefit?
What Are No Credit Check Hard Money Lenders?
Just as the name implies, no credit check hard money lenders do not perform credit checks on borrowers. Rather than using credit scores to determine interest rates, these lenders assess financial risk with more lenient criteria, such as the value of the applicant's real estate assets. No credit check hard money lenders are best for individuals with low credit scores who are in need of funds quickly - usually within a 7-14 day time frame.
Common Uses for No Credit Check Hard Money Loans
No credit check hard money loans are commonly taken out by individuals in order to cover expenses surrounding life events such as medical bills or home repairs. Additionally, this type of loan can be utilized in times when access to traditional lenders is not an option. This is particularly beneficial for financially disadvantaged minorities who often don't have the best access to traditional loan sources.
No credit check hard money lenders use asset-based lending as a means for evaluating a potential borrower. This entails using the assets of the person taking out the loan - such as income, business equipment, or real estate - to ascertain the level of risk. How does asset based lending work? The higher the value of the assets, the lower the risk of the borrower - and thus this affects the loan structure.
The Benefits and Potential Downfalls for No Credit Check Hard Money Lenders
Taking out a no credit check hard money loan has its potential benefits and downfalls. These loans often have larger repayment amounts and shorter repayment terms, so borrowers should enter into these agreements with caution. As with any loan, debtors should prioritize repaying their loan on time to better their chances of obtaining credit in the future.
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