In real estate, time is money. When dealing with hot deals like fix-and-flips or bridge loans, you need financing that moves at your speed. Hard money loans are the solution, but even with this efficiency, you must be prepared to close fast. A smooth closing is a planned closing.
Here is CoreLend’s essential guide on how to grease the wheels and secure quick approval for your hard money loan.
The Importance of Complete Documentation
Hard money lenders focus on the collateral and your liquidity. Delays almost always stem from scattered paperwork. Provide a complete package from the start to get approved faster.
- Proof of Liquidity/Funds to Close: This is paramount. Show recent bank statements or brokerage accounts verifying you have the cash required for the down payment, closing costs, and reserves. Submit clean, dated PDF statements.
- Investment Experience: Provide a concise list of your last 3-5 completed real estate deals (purchase price, repair costs, profit/timeline). This establishes you as a credible borrower.
- Entity Documents: If borrowing under an LLC, have the Articles of Organization, Operating Agreement, and EIN ready.
Strategies for Expediting Underwriting
You can shave days off the underwriting timeline by anticipating the lender’s needs and being proactive.
- Order Title Work Immediately: Waiting for the title search is a major bottleneck. Instruct your title company to start the moment your contract is executed and emphasize that this is a hard money transaction requiring immediate attention.
- Finalized Scope of Work (SOW): For rehab loans, submit a detailed, line-item budget and SOW with your initial application. This shows a concrete plan for renovation and value creation.
- Realistic ARV Projections: Provide solid comparable sales (comps) to support your projected After Repair Value (ARV). Confidence in your ARV accelerates the lending decision.
The Role of Rapid Communication
Once your application is submitted, the underwriter will issue “Conditions”—requests for clarification or documentation. How you handle these determines your closing speed.
- Immediate Response: Every hour you delay responding to a Request for Conditions is an hour lost on your closing date. Treat these requests as the highest priority and submit them the same day.
- Addressing Issues Upfront: If you have any known minor liens or vesting discrepancies, disclose them immediately with a plan for resolution at closing. Surprises lead to funding delays.
CoreLend Financial: Your Partner in Quick Funding
Our process is built for maximum efficiency. By ensuring your paperwork is complete, your strategy is sound, and your response time is immediate, you put yourself in the express lane for approval. Don’t just apply for a loan—apply to close.
By being meticulous and proactive, you significantly increase your chances of securing a hard money loan and unlocking the full potential of your real estate investment fast.
