Real estate is a powerful, time-tested way to grow your financial portfolio. There are various paths to real estate investing. Many investors start out by building a residential portfolio through direct ownership using traditional banks. But direct ownership isn’t the only method for building wealth with real estate. There is a more passive approach that has a wealth of advantages; that approach is private money lending aka hard money lending.
Private money loans are short-term loans secured by real estate. These loans are funded by private investors, like yourself, versus traditional lenders (i.e. banks and financial institutions). Loans made with Noble Capitol are secured by a first lien on tangible real estate assets, are written for a period of six to 18 months and offer target returns of seven to nine percent, paid monthly for the life of the loan (generally less than 12 months).
For many people, one of the biggest draws of becoming a private money lender is the fact that they can earn a respectable interest rate with little-to-no knowledge or even effort required – if they’re working with a proven private lender network. It isn’t just an alternative investment solution for active real estate investors, private money lending can be profitable for investors of any background to grow their portfolio. If you are considering ways to diversify your portfolio with alternative investments, here are some benefits of ‘becoming the bank’ with hard money lending and a private lender network.
- Ability to start lending quickly. Real estate investors generate high demands for project funding and, if you work with a private lender network, hard money lenders can instantly access loan opportunities.
- Hard money lenders don’t have the waiting time, transactional delays and red tape that come with bank financing because essentially they are the bank. For example, Noble can approve a hard money loan after just days in some cases, whereas traditional bank loans typically take 30+ days to fund.
- When you are the bank, the approval process is simpler. Banks operate in extremely risk adverse fashion and many projects will fall short of exceedingly stringent approval requirements. When you invest with hard money lending through a reputable network, you can finance projects that have been carefully vetted and approved, so you have far fewer limitations to approval.
- Hard money lending through a network saves you time, stress, and headaches. A network offers pre-vetted loan applications and you can choose the projects that best fit your financial goals. All without meeting with investors, no hours spent on research and data scouring, and navigating underwriting deals.
- Hard money loans are short term and more flexible than bank loans.
- The biggest advantage of being a private money lender is your input – or lack thereof. There is initial due diligence on the front end; however, once the project rolls out there is very little toil when compared with a real estate investor who manages the project from start to finish. Additionally, Noble Capital significantly reduces the front and back end input demands for private lenders with our full-service platform, including collecting your payments so you do not have to chase checks. Once you are in the network, we find a loan opportunity with a qualified buyer, the buyer is charged 10 to 14 percent interest on your money and we take care of all the due diligence.
Noble Capital is Texas’ premiere full-service private lender network leveraging experience and expert asset management to make short-term investments with a return a reality. Backed 100% percent by Texas’ real-estate market, Noble Capital bridges the stream of private lenders and borrowers seeking alternative investment opportunities through their Private Lender Network (PLN) in Austin, Houston, Dallas/Fort Worth and San Antonio. Noble Capital specializes exclusively in real estate-backed hard money lending and has built a full-service lending and loan servicing platform providing pre-screening, underwriting and asset management.