Hard Money Lender Business Plan, Marketing Plan, How To Guide, and Funding Directory
The Hard Money Lender Business Plan and Business Development toolkit features 18 different documents that you can use for capital raising or general business planning purposes. Our product line also features comprehensive information regarding to how to start a Hard Money Lender business. All business planning packages come with easy-to-use instructions so that you can reduce the time needed to create a professional business plan and presentation.
Your Business Planning Package will be immediately emailed to you after you make your purchase.
Product Specifications (please see images below):
- Bank/Investor Ready
- Complete Industry Research for the Industry
- 3 Year Excel Financial Model
- Business Plan (26 to 30 pages)
- Marketing Plan (24 to 28 pages)
- 425+ Page Funding Directory
- PowerPoint Presentation
- Loan Amortization and ROI Tools
- Three SWOT Analysis Templates
- How to Start a Business Guide
- Easy to Use Instructions
- All Documents Delivered in Word, Excel, and PowerPoint Format
- Meets SBA Requirements
Real estate developers and real estate entrepreneurs are always going to need capital to complete their projects. Given that it is very difficult to obtain ongoing capital commitments from traditional financial institutions, many people turn to hard money lenders in order to get the short-term financing they need in order to complete a real estate project. For many real estate developers, this can be an expensive form of capital given that there are usually a significant amount of upfront fees, with a very high interest rate. Additionally, most hard money lenders only provide a loan-to-value percentage of 65% to 70%. This is mainly due to the fact that to a certain extent hard money lending is a risky investment activity. Many hard money lenders often source or capital from a number of private individuals from which they have a ongoing and pre-existing relationship. The barriers to entry for a new hard money lender are considered moderate given that most of these firms are required to have appropriate licensure in place to act as a mortgage brokerage. This is primarily in cases where residential mortgages are being provided. Startup costs, outside of raising capital, usually range from $50,000 to $150,000 covers the working capital, professional fees, licensure, and initial marketing costs that are required in order to watch this type of lending business.
A hard money lender business plan usually focuses on the closing fees and interest is charged to borrowers in exchange for the capital they need. A well formulated hard money lender business plan also has a three-year profit and loss statement, cash flow analysis, balance sheet, breakeven analysis, and business ratios page. Generally, the balance sheet should be completed by a CPA or an accountant that understands how hard money loans are valued. It should be noted that in some instances specialized corporate structures are used so that loans are held by a third-party entity and that by the hard money lender themselves.
A hard money lender marketing plan is required in order to market lending services to real estate investors, entrepreneurs, and developers. As it relates to marketing for investors, an attorney should be retained to make a determination as to how you can reach potential investors and marketing to the general public. Some states and the federal government have rules in regards to how investment vehicles can be marketed to potential investors. Usually, only people that are considered to be accredited investors can place a significant amount of money with a hard money lending business.
For a SWOT analysis for a hard money lender, dispenser that these businesses are generally able to thrive in any economic climate. There are always going to be real estate opportunities that require very fast lending decision so that they can be completed. Additionally, the gross margins generated from interest fees and closing fees are extremely high. As it pertains to weaknesses, there are a number of regulatory requirements must be adhered to at all times when a person engages in hard money lending. Also, there are significant competitive issues that must be dealt with. Relating to opportunities, most hard money lenders expand their business operations by acquiring additional rounds of capital to provide a larger number of loans. For threats, changes in the underlying interest rate as well as regulatory changes pertaining to lending can have a negative impact on a hard money loan business.
In closing, hard money lenders are one of the oldest types of lenders within the United States. They are always going to be in demand given that there is a substantial amount of real estate within the United States, and there are always going to be developers and entrepreneurs that want to capitalize on potential opportunities.