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In order to be approved for a loan from a traditional lending institution, a prospective borrower must meet certain criteria, which typically includes a steady source of income, good credit history, and sufficient collateral. Unfortunately, not everyone fits this mold and will not qualify for financing, which is where Atlanta private money lenders should be able to help them.
A private loan is made available by private investors who provide financing to borrowers who were turned down by mainstream lenders. Loan officers or lenders act as liasions between these investors and potential borrowers, matching them according to their needs. Terms and rates will vary.
Those in search of a loan officer may find one in the Yellow Pages, online, or through a personal recommendation. Any lender one is considering doing business with should first be checked out in terms of their foreclosure rate, and also be requesting and contacting several current or past clients as references.
Once a lender has been selected, the prospective borrower will need to apply for financing. A "Statement of Information" form is submitted along with any supporting documents to provide an overall picture of the applicant's financial situation. Any problems the borrower has in terms of credit history, assets etc. Should be brought to the attention of the lender, since he or she may be able to offer a work-around for this issue.
The money loan package best suited to the client depends on his or her financial state as well as the intended purpose of the funding. Similarly, the maximum loan amount and interest rates will also be based on these factors. The more details pertaining to the use of the money, the better: lenders prefer to have a clear idea of how the funds will be spent.
A few more actions will need to be taken if the loan being applied for is to purchase real estate, such as an appraisal, obtaining either a Broker Price Opinion or Automated Valuation Model, and possibly communicating with an escrow company. It is essential that any outstanding liens against the applicant or property be resolved and that documented proof of this be provided.
When the investor approves the loan, the lender prepares all the contractual documents which are required to make it official. Clients must read these documents over very carefully before signing anything and ensure they fully understand the terms. Then the funds will be released to the borrower, proceeds directed to the investor, and the loan documents will be filed with the county. The loan servicing company will "board" the loan, which establishes a regular system of payments that will be in effect until the loan is paid off.
A private loan is made available by private investors who provide financing to borrowers who were turned down by mainstream lenders. Loan officers or lenders act as liasions between these investors and potential borrowers, matching them according to their needs. Terms and rates will vary.
Those in search of a loan officer may find one in the Yellow Pages, online, or through a personal recommendation. Any lender one is considering doing business with should first be checked out in terms of their foreclosure rate, and also be requesting and contacting several current or past clients as references.
Once a lender has been selected, the prospective borrower will need to apply for financing. A "Statement of Information" form is submitted along with any supporting documents to provide an overall picture of the applicant's financial situation. Any problems the borrower has in terms of credit history, assets etc. Should be brought to the attention of the lender, since he or she may be able to offer a work-around for this issue.
The money loan package best suited to the client depends on his or her financial state as well as the intended purpose of the funding. Similarly, the maximum loan amount and interest rates will also be based on these factors. The more details pertaining to the use of the money, the better: lenders prefer to have a clear idea of how the funds will be spent.
A few more actions will need to be taken if the loan being applied for is to purchase real estate, such as an appraisal, obtaining either a Broker Price Opinion or Automated Valuation Model, and possibly communicating with an escrow company. It is essential that any outstanding liens against the applicant or property be resolved and that documented proof of this be provided.
When the investor approves the loan, the lender prepares all the contractual documents which are required to make it official. Clients must read these documents over very carefully before signing anything and ensure they fully understand the terms. Then the funds will be released to the borrower, proceeds directed to the investor, and the loan documents will be filed with the county. The loan servicing company will "board" the loan, which establishes a regular system of payments that will be in effect until the loan is paid off.
About the Author:
Tom G. Honeycutt is a full-time real estate entrepreneur in Atlanta, GA. Tom helps readers by providing practical and useful knowledge to better understand lending choices. If you are looking for How to find Atlanta Private Money Lending he suggests you visit his friend's for more information.
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