It’s every borrower’s worst nightmare: it’s 10 days before closing and the primary lender suddenly and unexpectedly reverses its decision to fund a loan. In a moment’s notice, months of hard work just disappears, with the borrower left scrambling to find a way to keep this deal afloat.
While this is an all-too-frustrating — and all-too-familiar — experience, there’s no reason to lose all hope when a conventional loan goes south. Private lenders such as Kennedy Funding fill the void left by a traditional lender. Whether it’s two months, three weeks or even a few days before a loan is set to close, an alternative funding solution’s purpose is to step in and act quickly when banks won’t, can’t or otherwise decide not to follow through with funding a loan.
Once the bank delivers the bad news, it’s important to step into action as soon as possible. Not sure where to start? Follow the steps below to jumpstart the alternative funding process.
- Contact a private lender such as Kennedy Funding. Hard money lenders know just how time-sensitive these situations can be. They’re well-equipped to immediately review loan applications and arrange a conference call to thoroughly discuss the urgent need. At Kennedy Funding, our relationships with appraisers and attorneys are based upon quick turnaround, so all parties are solely focused on securing a hard money loan as soon as possible.
- Gather the appropriate documents. A private lender will need to review and approve certain documents such as title, independent appraisal, judgment and lien searches, environmental reports, etc. Having these documents in place ensures that your loan will close. Make sure to have copies of these documents on hand so that the private lender can review them as part of the application process.
- Be prepared to provide a thorough rundown of any challenges you may face during the loan process. It is extremely important to be up-front with the private lender while discussing the application. By disclosing problems such as credit issues or bad partnerships, a hard money lender can property navigate those issues and avoid any surprises which may impact the deal’s completion down the line.
Don’t distress when the bad news about primary funding comes through. Alternative funding sources, such as the hard money loans secured through Kennedy Funding, are designed to step in and help secure what was lost. Ready to act today? Read our step-by-step guide to closing a loan in a little more than a week, then contact us to begin the application process.