Frequently Asked Questions (FAQs)
Does Gateway Private Money Provide Pre-Approval Letters?
Yes, an online submission is required for us to send a pre-approval letter.
What can you expect to fill out for a private money loan?
You can expect to fill out a Business Purpose/Commercial Loan Application.
Do we only lend on real estate in California?
Yes, for now.
How fast can you close my deal?
With Gateway Private Money, the standard time to close is 5-10 business days. In some cases we can close in as quickly as 72 hours.
Are extensions granted?
Yes. Extensions may be granted on a case-by-case basis. Additional fees will apply.
Do we require insurance?
Yes. We require hazard and title insurance on each property that we lend on.
What is Hard Money Lending?
A hard money loan is a type of loan secured by real property. These loans are typically funded by private investors or companies, rather than traditional financial institutions like banks. They are often used by real estate investors who need quick financing or who may not qualify for traditional bank loans due to credit issues or the unconventional nature of their investment projects.
Hard money loans usually have shorter terms (often ranging from six months to twelve months) and higher interest rates compared to traditional mortgages. They are considered "hard" because they are backed by the value of the property rather than the borrower's creditworthiness. The lender assesses the value of the property and lends a percentage of that value, known as the loan-to-value (LTV) ratio. If the borrower defaults on the loan, the lender may foreclose on the property to recoup their investment.
What is Private Money Lending?
A private money loan, also known as a private lending or private financing, is a loan provided by an individual or a private entity rather than a traditional financial institution like a bank. These loans are typically used for real estate investments, business ventures, or personal financing needs.
Private money loans often offer more flexibility in terms of loan terms, repayment schedules, and eligibility criteria compared to traditional bank loans. They can be structured in various ways depending on the agreement between the lender and the borrower. Interest rates on private money loans may be higher than those offered by banks, reflecting the increased risk taken on by the lender.