What Is A Hard Money Loan?

A hard money loan is a type of commercial real estate financing that provides funding for the purchase and rehabilitation of income-producing properties. Hard money loans are typically offered by private investors or companies that specialize in this niche, such as Bridge Loans. They have lower interest rates than traditional bank loans because they are secured by the property being purchased. Hard money lenders provide quick access to capital at competitive rates with flexible terms for borrowers who need funds quickly to close on an investment property or flip it before it appreciates in value.

 

What are some of the benefits of a hard money loan?

If you don't have good credit, a hard money loan could be your best option. Hard Money Loans also allow for non-owner-occupied properties. A Hard Money Loan can often close in as little as 5 to 14 days (depending on property type). These loans are perfect for those looking to close on a property fast and without the hassle of going through the typical mortgage process.

 

What type of financial institution offers hard money loans?

There are many types of financial institutions that offer hard money loans. One type is a private bank or lender, which typically offers these loans to borrowers who cannot obtain financing elsewhere or whose property values do not meet the lending requirements for conventional mortgages.

 

What are the terms of a hard money home loan?

Hard money loans are available in a variety of terms and conditions. Interest rates can range from as low as 6% to as high as 18%. Loans are typically interest-only payments, and the length ranges from 6–18 months at the lender's discretion.

 

Conclusion

A hard money loan is a type of asset-based lending that typically comes with higher interest rates and shorter repayment periods than traditional loans. They are often used as an alternative to a home equity line of credit for individuals who have high net worth but lack the necessary qualifications or collateral needed to obtain financing elsewhere. Hard money lenders evaluate each application on its own merits, so there are no set criteria for eligibility beyond being able to provide adequate security in the form of assets like real estate or personal property. If you need help getting started applying for your next investment, give us a call today at 877-231-3111. We can answer any questions about what types of properties qualify and how much they cost.

 

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