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Benefits of Payday Loans
A payday loan is required for many reasons nowadays and is sought after more, rather than traditional bank loans or borrowing from family and friends when you require cash urgently. Cash emergencies arise when you least expect it and there are instances that you cannot hold on until bank loans are processed and finalized. Online payday loans or payday loans are short term loans that are usually offered by payday loan companies and not banks. This has been highlighted in the recent years as a short term credit option for people who require cash advance loans. The benefits of payday loans are as follows.
Payday loans are easily accessible. You can apply for payday loans online, over the phone or even in person. Unlike traditional loans they require very little information other than your proof of income and bank account information. You have to be 18 years or older to apply and qualify for this facility. Payday loans are usually approved within 24 hours if you have provided them with accurate information. Unlike traditional loan schemes that take up to several weeks, payday loans can be approved and credited to your bank account the following business day and you can immediately make use of the cash.
Another advantage of a payday loan is that it requires no credit check as opposed to traditional bank loans. Usually banks check your financial background before providing you with a loan facility. They check if you have defaulted with a payment and endured any type of financial crisis. But with payday loans, the only required information type is proof of your income and having a stable bank account.
Payday loans are also considered to be a credit management tool since this is mainly obtained to settle bills before your pay check arrives and settling it when it does. You also have easy access to the funds within one working day making it convenient and hassle free. Payday loans are mainly an easy way out of lifes financial difficulties. It only takes you to face a money emergency and then you apply for it online which is the most convenient way and sit back and relax until you receive the money shortly.
Commercial Construction Loan Financing Tips
Many brokers will encounter clients who require construction loan financing, some more than others. Commercial construction loan financing is usually required by developers and investors who purchase land that they would like to develop or are purchasing fully developed land in the form of a single or several ready to build lots. Land with an existing home or structure on it is most often referred to as “infill construction”. In the event that a builder is simply improving an existing structure including for example a top up (second storey) or remodelling, we refer to this type of construction as a renovation. All of these examples most often require construction funding and apply to either residential or commercial real estate.
There are several different types of construction loans. When a builder or developer acquires land for development they will seek out a land loan often combined with a facility for land development. The land loan serves to close the land purchase while the development loan serves to fund the planning and development of the land so as to improve it for greater use such as residential or commercial zoning from agricultural for example. Following the acquisition and initial development a developer or builder will require financing to service the land which includes the installation of sewer, water and hydro and will require a land servicing loan. The next round of financing is usually to a builder unless the builder and the developer are one and the same. The builder will require a construction loan to build either a residential or commercial building.
Here are some quick tips you may want to keep in mind if you are representing a client who requires development or construction loan financing.
Lenders who offer construction loan financing will always hold back 10% from every advance in accordance with the Construction Liens Act save and except an advance on land. Borrowers need to be made aware of this for budgeting purposes at the outset to ensure that there is no confusion in the future.
It is important that your client has a good budget that includes a detailed breakdown of hard and soft costs and includes the interest reserve in the soft costs.
Be prepared to use a quantity surveyor whose job will be to approve the budget on behalf of the lenders and provide reports on progress of construction to the lender that certifies every advance in accordance with the budget. For smaller residential construction loans some lenders will use an appraiser to report on progress.
In almost all cases, lenders will lend construction loans on a “cost to complete” basis. This means that the funding program will be advanced in progress draws and will also be subject to 10% holdbacks in accordance with the Construction Liens Act as previously mentioned. This ensures that there is always enough money in the remaining budget to complete the project.
The presence of a first mortgage that was obtained for construction purposes can create a challenge if your client plans to obtain second mortgage financing as the second mortgage lender would be required to postpone every advance under the first mortgage or construction loan that has priority on title.
Offering commercial construction loans can be very lucrative for a mortgage broker or agent. An opportunity to arrange this financing is an excellent opportunity to learn about how you can diversify the range of products you are able to offer to your clients. Either co-brokering the deal through an experienced broker who specializes in construction financing or working with a construction loan financing lender who is willing to educate you and walk you through a project is a great way to gain experience and to be able to offer this type of financing to your clients.