855-949-FUND(3863)
NMLS #: 1202436 BRE #: 01954763
Blog
Home / Hard Money Blogs / Hard Money Info: Here’s How Hard Money Loans Actually Work

Hard Money Info: Here’s How Hard Money Loans Actually Work

0

Hard Money Loans Actually Work: Getting the financing you need to investing a property in just a matter of days sounds great right? But what is the process of a hard money loan? What is it exactly and what is your first step to getting one? 


Hard Money Loans provide investors with capital that is used to purchase investment properties. The reason why they’re so popular is because they can be funded in a matter of days after receiving the final documents from the Title Company. Hard money loans are available for adequately collateralized loans on real estate. 


Basically, the lender doesn’t look at your credit or finances–just the property that you already have (or are about to buy with the loan) which can be used as collateral. This means that if you fail to repay the loan amount, the property will be seized by the lender. As long as you pay the amount back, plus interest, you’re in the clear. 


Hard money loans are great for fix-and-flips because they are funded quickly and they are short-term. Hard money loans that should be paid back between 3 months and a year though some are as long as two years. A fix-and-flip shouldn’t take longer than a year if you do the numbers correctly and research the project efficiently. 


The amount that the hard money lender will lend an individual varies but generally does not exceed 70% of the after-repaired-value (ARV). 


Hard money loans are not necessarily better than loans from traditional banks because they both serve different purposes. If you don’t have the time to wait for your application to be approved, then you should get a hard money loan. If you want to fix and flip a house, you should use a hard money loan. If you can’t get a loan because you have bad credit or no credit, a hard money loan is right for you. 

Recent Posts
Contact Us

We're not around right now. But you can send us an email and we'll get back to you, asap.

Visit Our Facebook PageVisit Our Facebook PageVisit Our Facebook PageVisit Our Facebook Page