Buyers still want to buy even with tarnished profiles and people still need to refinance their homes to buy another property, do home improvements, etc. Hard Money is the only option out there if they have been turned down by their favorite bank or savings and loan or mortgage broker or mortgage banker. Or all of the above!
Hard Money, also known as Private Money, is money borrowed from private individuals. Most private money lenders/investors lend money through a mortgage company (there are laws that require this).
Basically considered “all cash”, such loans are extra strong and can be used to purchase or refinance dump property, bad credit borrower, irregular income borrower, large cash out borrower, someone needing fast cash, short term Bridge loans, etc. Hard money loans are based largely on equity. The most you will get is 75% of the value of the property.
Hard Money loan qualifications are more forgiving than conventional or bank financing. The two basic qualifications are: #1. Decent existing real estate equity or at least a 25% down payment if a purchase and #2. An ability to repay the loan.
The rates are higher and it will likely cost a bit more than a 30 year fixed rate loan but it can get you the money you need if refinancing or it can fund your next dream home purchase. Many people have credit card rates that are 15% to 32% and Hard Money rates average 9% to12% with interest only payments.
If you are in California I invite you to give us a call at 707-523-2099 to see how Hard Money will work for your situation. Having worked with many types of loan scenarios at Sun Pacific Mortgage & Real Estate since 1988, we are pretty experienced, we are honest and our rates are pretty good!
I hope you found this blog helpful and now have a better understanding of what is a hard money loan.
Forest – The Guy in the White Hat
Broker/Owner of family company Sun Pacific Mortgage and Real Estate since 1988.
Licensed CA Broker. BRE #01464899/ NMLS #360993. Phone number is (707) 523-2099. See regularly updated website @ www.sunpacmortgage.com.