Short-Term Secured Loan Tips

Video Transcript

"This is Patrick Munro talking about short term secured loans. Short term loans are loans that are designed to be implemented over a short period of time, sometimes thirty days, more often than not on a quarterly basis, that's every ninety days, sometimes six months, and oftentimes to a maximum of one year. These loans are oftentimes needed to be secured, and of course most of these loans are designed to be secured by underlying assets. The most popular short term secured loan is an interim construction loan for the purpose of building a house. More often than not the bank will take the lot that the house is built on as the initial security and then it will have the house as it comes out of the ground and becomes built up, that also becomes the short term security for the bank. At the end, when the house is completed, you have a strong asset that is normally worth more than the original loan, and then a permanent loan comes along to take out the short term loan which has been securitized by the underlying lot and the house. This is Patrick Munro talking about short term secured loans."