The New Hard Money
Hard money isn’t what is used to be. Case in point: Washington Capital Partners, a private hard money lender that couples real-life investing experience with cutting-edge technology and superior customer service.
IF HARD MONEY MAKES you think of loan sharks and basement deals, you are not alone. However, the space has evolved dramatically in the last six years. If you don’t understand these improvements, you could be missing out on an important source of private capital for your next—or your first—real estate investment.
Hard money lenders are private sources of capital that provide loans to real estate investors so they can fund their projects. These lenders are able to work with investors that traditional sources of capital tend to pass on. Because hard money lenders do not have the same regulations and red tape that big banks do, they are able to close on properties faster, which is key in the competitive investor landscape.
Daniel Huertas, CEO of Washington Capital Partners (WCP), a leading private hard money lender in the DC Metro area, explains that his firm uses a simple but thorough application process to evaluate potential projects. His team looks at factors beyond a borrower’s credit score and personal wealth, such as the potential of the investment property. This allows the firm to take on high-risk/high-reward opportunities that make most banks skittish. “Not everyone has the credit score or track record that banks require, especially not new investors. To get their feet wet, investors need a resource like ours—otherwise, they might never become investors at all,” says Huertas.
Huertas understands the needs of investors because he has been in their shoes. In 2009, he left a job at a leading financial institution to become an investor himself. “At the time, no one wanted to lend money to me and my partner. The private lenders we met had no manners and did not care about relationships. That’s when I decided that rather than be an investor, I would create a way to help investors who have been overlooked.” Huertas went on to design a borrower-centric hard money lending firm, purposefully built to address the problems he had experienced with traditional and private lending processes first-hand.