Hard Money is Becoming Harder - Air Jordan Light

It's clear that the banks are running out of money, good decisions and good excuses for denying loans to businesses, property investors, and individuals Penny Hardaway Shoes. It seems that we have reached the lunatic fringe in that even a person with AAA credit, great income, and a substantial net worth is not deemed as credit worthy.

Realizing that banks are hoarding cash to try and make it through one, if not the worst financial crisis in US history, it now seems that the new paradigm in lending guidelines is that you must have more money sitting in a bank account than the amount you want to borrow Air Jordan Light. It is because of this that hard money lenders are being asked to step up to fill the vacuum created by the credit crisis.

Hard money, aka private money or any financing that is an alternative from conventional bank financing, is quickly becoming one of the only funding sources to get deals done Nike Mercurial Shoes . Many Asset Based Lenders (ABL) in the form of ABL Funds are operating as hard money lenders, and generating large profits for their investors.

The only problem that hard money lenders are facing right now is running out of money to lend, because the demand from borrowers is absolutely overwhelming Air Jordan Light. Investors are becoming aware of this and we should see an inflow increase into these funds.

One might argue that the economic crisis is going to effect the borrower repayment of these hard money loans, and they would be right in that assumption. The big difference is that ABL fund's are lending at very low loan-to-values, and even in a distressed market, they sit in a position to profit. Rates seem to be between 11%-20% and rising due to the demand.