The 3 Main Differences Between Hard Money Lenders and Real Estate Crowdfunding

private money loansIf you’ve been observing money market trends for a while now, you may have noticed the popularity of alternative sources of credit. Small and medium sized businesses and individual borrowers are looking for better, and faster, access to credit at lower interest rates than what was obtainable before.

There are many factors responsible for this trend but two, in particular, stand out. Firstly, the continuous economic uncertainties in the US and the world generally and secondly, traditional banking institutions have failed woefully in satisfying the needs of potential business ventures.

Added to all this is the fact that retail investors on their own part are also seeking better ways to grow their money and report higher returns on investments.

You can see why there’s such a “fertile grown” for alternative financing. Specifically, a new financial sector has been created to fill the gap and that’s where hard money lenders and real estate crowdfunding come in.

Although these two were created from the same need, they are very distinct and different in operation and orientation.

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