Are you a real estate investor looking to secure a hard money loan? If so, you’ve come to the right place! In this blog post, we will discuss the key factors that can make the hard money loan process go smoothly. By following these guidelines, you can ensure a quick and efficient loan approval process, allowing you to focus on your real estate investments.
Submit Required Documentation Promptly
One of the most important keys to a smooth hard money loan process is submitting the required documentation promptly. While borrowers are often informed that the loan can close in 7-10 days, it’s important to note that most lenders, on average, prefer a timeframe of 21 days. By submitting your documentation quickly, you can help expedite the loan approval process.
To ensure a seamless submission process, it is crucial to have the necessary documents readily available in digital format. Here’s a checklist of the essential documents you should always have on hand:
- Schedule of Real Estate Owned: Keep an updated digital copy of your real estate portfolio. This will help the lender assess your experience and financial standing.
- LLC or Entity Documents: Make sure you have your LLC or entity documents, including the Operating Agreement and IRS IEIN letter, easily accessible in digital format. These documents establish your legal structure and credibility as a borrower.
- Tax Returns: Provide digital copies of your last two years’ tax returns. This information helps the lender evaluate your financial stability and income history.
- Photo ID: Keep a digital copy of your photo ID handy. This is a standard requirement for loan applications.
- Purchase and Sale Agreement: If you have a property under contract, include a digital copy of the Purchase and Sale Agreement. This document verifies your intent to purchase and provides essential details about the transaction.
- Earnest Money Deposit: Include documentation of your earnest money deposit, such as a digital copy of the check or transaction receipt. This shows your commitment to the deal.
- Sold HUD Settlement Statements: Provide digital copies of your sold HUD Settlement statements to demonstrate your experience in successfully closing real estate transactions.
By having these documents readily available in digital format, you can streamline the loan application process and avoid unnecessary delays.
Keep Current Documentation on Hand
While some documents, such as bank statements, hazard insurance, and retirement account statements, may not be required initially, it is essential to keep them up to date. These documents may be requested by the lender during the loan processing stage to verify liquidity and financial stability. By maintaining current documentation, you can quickly produce these items when needed, preventing any unnecessary delays in the loan approval process.
Conclusion
In summary, making the hard money loan process go smoothly requires proactive preparation and organization. By promptly submitting the required documentation in digital format and keeping current documents readily accessible, you can expedite the loan approval process and avoid becoming the bottleneck. Remember, time is of the essence in real estate investing, and a smooth loan process can give you a competitive edge in securing lucrative deals.
If you’re a real estate investor seeking a hard money loan, contact us and get financing from Preferred Capital Investors today!
Note: The information provided in this blog post is for informational purposes only and should not be considered financial or legal advice. Consult with a qualified professional for personalized guidance.