Things To Consider Before Approaching Private Money Lenders in California

Private Money Lenders in California can you get you the money you need and get it to you quickly, but are you fully aware of what you could be getting into by using one of them?

It’s a sad fact in business, but a fact nonetheless. Sometimes, there are going to be things that come up that you can’t plan for and can’t ignore. You are going to have to deal with them. But if you are a young, up-and-coming business, chances are good you are not going to have a lot of capital just laying around waiting for you to put it to work.

So—you are going to need money and depending on the severity of the issue that arose, you are going to need it quick. Private Money Lenders in California are generally quick to approve loans for cases such as yours, so you decide to hit one up.

However, before doing so, there are things you should keep in mind.

Do You Really Know What You Are Getting Into With Private Money Lenders in California?

Before you get into business with a private money lender, it is good to have an understanding of what you are getting into.

They are not going to give you a 30-year loan. They don’t do long-term loans. Private money lenders are into short-term loans; stuff more in the three to 18-month range. Before you know it, you are going to have payment to make, and since the term of the loan is short, they are going to be bigger. It’s great to be able to get the money in a few days rather than weeks or months (like through other channels). But they are going to want their money back quickly as well.

So, be sure you can handle the payments before entering into any kind of deal. With the high-interest rate that you’ll get charged and the fewer number of payments, your monthly note can be high depending on how much your loan is. Yes, you may need the money and don’t have any other choice, but there is always another way.

No sense in trading one problem for another.

Will it Really Help?

At the time, it may feel like the cash you can get from Private Money Lenders in California is the only viable option. But sometimes you need to figure out how to take a step back and look objectively at your situation to figure out if it will really help.

Will it help you generate revenue? The loan is money you are going to have to pay back so will whatever you need it for help you make more money? Or are you trying to cover expenses because you didn’t make enough? If so, then you may have a larger issue on your hands.

If this loan is not going to help your cash flow, then maybe it is time to come up with an alternative solution—or an alternative form of revenue.

About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.