BlackStone Funding LLC

Hard Money Business Acquisition Loans in New York

Hard Money Business Acquisition Loans in New York

Your Fast Track to Securing the Business You’ve Always Wanted

Opportunity is a powerful tool and that’s why time is central to its success. In case you’ve identified the perfect business to acquire but you are short on time to mobilize capital, then a hard money business acquisition loan is the perfect loan to take. However, New York’s market is rather active, and conventional financial instruments could take a long time or contain nuances that slow down the acquisition. Hard money loans provide swift and rather convenient funding to enable the client to capture business buying opportunities without extensive queues.  

Hard Money Business Acquisition Loans: What does It Mean?

A hard money business acquisition loan is a type of short-term loan which is used to fund the purchase of an existing business. These loans are usually offered against the security of the business interest, and other properties that the borrower offers and not against his credit scores or elaborate credit history. HML are more concerned with the prospects of the business as well as the security offered in the loan; thus, there is faster approval of the loan without stringent procedures being put in place.  

Hard money loans are ideal for circumstances where one requires cash within a short period for instance when acquiring a business, when specific deals or biochemical businesses need to be made quickly. It doesn’t take much paperwork to change your status and immediately you can begin claiming ownership of your new business in New York.   

Why Use a Hard Money Loan to finance the Acquisition of a Business?

In New York’s business environment, time is an important determining factor that defines a firm’s ability to undertake business acquisitions. Most of the conventional lending institutions may have an evaluation process that takes several weeks or even months to complete while hard money loans can be funded within several days. 

Here’s why a hard money business acquisition loan might be the right choice for you:

Speed and Efficiency : If their required time is tight, then hard money loans are again flexible in that they provide quick approvals, and disbursement of funds. In addition, you will not be slowed down by a numerous number of approvals to conduct the research or a lot of paperwork.  

Less Focus on Credit : Hard money lenders mainly consider the value of the business or the properties used for the business in the deal. This means even those with feeble financial records or those who have not been in business for some time can easily get a loan. 

Flexible Terms : It is important to know that hard money loans are flexible and are designed to suit your business acquisition needs. The loan paragraphs can sometimes be adjusted with certain conditions in which you are able to repay the loan depending on your plans. 

Bridge Financing : If you are in the process of getting permanent financing and you require to close the acquisition as soon as possible, then a hard money loan is considered as a bridging loan. This makes it possible for you to buy the business fast and once you own it you can then get a conventional loan. 

How Hard Money Business Acquisition Loans Works

A hard money business acquisition loan can be defined as a short term loan and it may take between a period of six months and twenty-four months. 

Here’s a step-by-step look at how these loans work:

Initial Consultation : The process actually commences with an introductory meeting, where you will talk about the business which you want to buy, the amount of cash needed and your security. Unlike conventional banking institutions, the tenure of hard money lenders rely so much on potential of the acquisition or the security for the loan rather than financial reports and financial statements. 

Loan Approval : Getting approval for hard money loans is also easy, and it only takes up to 48 hours in most of the cases. The lender will be able to determine the value of business assets and your business acquisition plan. Under the circumstances, the approval is speedy when the deal seems good and the collateral is adequate. 

Loan Funding : Funds are usually released within two to three days and enable you to finalize the acquisition of the business successfully. This can be very important especially in situations where time is of essence and if one party takes long they are likely to lose the deal. 

Repayment and Refinancing Options : As compared to conventional loans, hard money loans tend to have shorter durations and rather steep rates of interest. Nonetheless, the common borrowers apply these loans as intermediate funding to obtain more favorable long-term financing after it acquires the target and stabilizes. 

Key Benefits of Hard Money Business Acquisition Loans:

Fast Approval and Funding – While traditional loans might take a lot of time to be approved, hard money loans come handy thereby helping you to close the acquisition within a few days.  

Easier Qualification – Since a lot of importance is placed on the value of the collateral to be offered and the prospect of the business, hard money lenders are lenient in their lending standards. 

Short-Term Flexibility – This type of loan is best for short term uses, but since they involve property assets, they are very useful for business purchases or, for instance, when waiting for long-term funding.

Who Is Hard Money Business Acquisition Loans Right For?

Hard money business acquisition loans are particularly beneficial for:

Entrepreneurs and Investors – In case you are planning to purchase a business in New York and are time constrained to wait for conventional financing, a hard money loan is the way to go. 

All those business owners who have imperfect credit scores. – Traditional funding sources may decline because of poor credit status while hard money lenders rely on the business assets as well as other security enhancing the possibility of attractive financing. 

Buyers of Distressed Businesses – In this case, if you are buying an affected business, you may find most conventional banks very reluctant to fund, majoring on perceived risks. This is because hard money lenders are more willing to fund these acquisitions providing you with the opportunity to get things working again.   

FAQs

Hard money loans are short term loans mostly fixed based on the value of the assets or collateral compared to traditional loans where credit ratings of the borrower take much more importance. While it may take a month or longer for a conventional loan to be disbursed, a hard money loan can be disbursed within a week or so and does not require the complicated documentation that is usually needed for conventional loan applications.  

Hard money loans are famous for its fast turn-around time in approval and funding. Typically, in most cases, one is likely to receive approval within 24-48 hours while funds can be disbursed within a couple of days to enable fast execution of an acquisition of a business. 

Some of the criticisms associated with hard money loans include higher interest rates than the standard loans because they are short term in nature as well as the approval process. Loan terms range between 6 and 24 months though there’s the possibility of the borrower paying off the loan or rolling it over when long term financing is received. 

Indeed, hard money loans can be applied to purchase various types of businesses including those with significant assets or guarantees. However, the amount to be given as the loan will depend on the current worth of business and the security offered. 

This can be the company’s assets such as land, fixtures and fittings, and stock etc which is into the business being purchased. In some cases the personal property such as house etc can also be offered as securities depending on the terms of the specific financier. 

Summing up, hard money business acquisition loans can be identified as a rather efficient and flexible opportunity as far as the business acquisition is concerned in New York City market conditions. Fast approval, flexibility in loaning the terms and easy to obtain without necessarily requiring credit, make it possible for borrowers to obtain loans where conventional financiers may be lacking. 

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