Why would a borrower agree to 15% interest rates and 5% for a hard money loan? They have worse options. They may lose substantial equity or must take on a partner who may take a greater percentage than what a hard money lender would.
If they fail to close in a timely manner, they could lose their property or business opportunities. Commercial hard money loans are also easier to obtain than traditional loans.
You can also hire the best hard money mortgage lenders in Florida to get your commercial hard money loans. If the project doesn't go as planned, partners have the potential to cause legal problems.
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Borrowers who are seriously considering working with a hard-money commercial lender should only do so if they have been recommended to them by an independent, experienced third party.
These people are often unethical and take $5,000 deposits in good faith with no intent to fund loans.
Many borrowers will find that this $5,000 is their final money and won't be able to make the error of choosing the wrong hard money lender.
Borrowers are almost without recourse as they must sign agreements that state the fees are non-refundable and that the Letter of Intent only represents "interest". This, however, allows the hard money lender to fund the deal.