There are many ways to pay for your education. Among the most common options are different kinds of loans. If you’re looking for help paying your tuition, private money loans are an option. Some of these alternative loan companies secure your loan through assets you already own. This could be a good approach for someone who is looking for alternative loans for college. You can find many of these companies online, so look into some of them and find one that is trusted and has good reviews from previous borrowers. This will help you avoid dealing with dishonest companies and possible financial trouble in the future.
The best private loans for grad school are going to depend on where you go to school and what program you’re in. There are many options available to you and some may be more appropriate than others. For any help for private student loans, you can talk to your school’s financial aid office or discuss it directly with the lenders. Both of these can help you get the right loan for your situation.
UPDATED 2/22/21
There are different types of business and residential loans available for qualified borrowers. This includes traditional bank loans as well as private hard money loans. It’s important to note that there are significant differences between these two types of loans.
Basic Qualifications for a Bank Loan
When someone is interested in taking out a business loan, for example, there are several criteria they need to meet in order to do so. In addition to being established in business for a minimum of two years, they also need to meet the following qualifications:
- A minimum of $250,000 in annual revenue
- A good personal and business credit history
- A cash-flow positive status
Basic Qualifications for a Private Loan
For the most part, a private hard money loan is secured by one or more properties owned by the borrower. Since this is how an investor’s assets are protected, these properties need to have a certain percentage of equity. In general, this will range between 30% to 50%.
In order to establish home equity, a certain amount of time needs to pass. This is because most buyers will take out a 15 or 30-year mortgage. While house prices do fluctuate, they tend to increase over time. Due to this, as people become older, they will have an increased percentage of equity in their home. For homeowners under the age of 35, the median amount of equity they have may be $20,000. Given today’s housing market, this would likely be insufficient to apply for a hard money loan unless they possessed other assets from a business or another source.
Loan Durations for Bank and Private Money Loans
There are also different payment periods for each type of loan. Traditional loans are usually repaid over a longer period of time than private loans. This can range between one to 20 years. Private loans, however, have a shorter repayment duration. These are usually granted for up to five years or less.
Interest Rates for Hard Money Loans
Interest rates are higher for hard money as opposed to bank loans. These types of loans also have lower loan to value ratios. While these rates will vary, they can begin at 15%, 18%, or at an even higher rate.
Learn More About Hard Money Lenders and Loans
If you’re considering your options, you may be interested to know that hard money lenders can provide you with funds faster than a traditional bank can. The time it takes to process a loan with a hard money lender is usually between seven to 14 days. This can make a significant difference when you’re planning to expand your business, purchase a second home, or otherwise make a personal investment.
It can be really difficult to find the money for college tuition leaving many students looking for affordable student loans. There are always government backed student loans and grants but those funds are capped and may not cover all the costs associated with going to school. Some students may look at taking out a personal loan but will soon realize private student loans provide more protection to the borrower than personal loans. This can lead cash strapped students to look for the best kind of student loan available. In the co-ed’s search for the best private education loans, they may find that most are directed towards graduate students, which is not something a poor college student can make use of while getting their bachelor’s degree. Undergrads will then have to narrow their search to find the best private loans for undergraduate students. Many will try to obtain loans from traditional lending institutions only to be turned away due to lack of credit history or failing to meet income requirements. Thankfully those students can turn to private money lenders who will not only help them cover the costs of their education but also help build credit history.
