Take Charge With Hard Money Loans
Making the decision to invest in a real estate property property is easy, but finding where to get the financing is much more difficult. Applying, and more importantly, getting approved for a conventional loan these days has been rendered troublesome for many borrowers in today’s economy for a number of societal and economic factors. One being that following the 2008 housing crisis that sparked the great recession, the Federal Reserve tightened credit policies, making it more difficult for borrowers with less than glistening credit history and income to be approved for a conventional mortgage loan. But in classic form, lenders have made it possible for these types of borrowers to acquire the financing they need through a collection of alternative financing methods. If you are looking to take advantage of these options, take charge with hard money loans.
Hard money loans are simply a non conforming loan that is lent from a private lender, often times an investor. They are referred to as “hard” money loans because they are backed by a hard asset, most commonly real estate property. The hard asset is used as collateral in the event that the borrower cannot meet the payment obligations arranged between him and the lender. Hard money loans terms usually have a limit on the loan to value ratio (LTV) on which the loan is to be lent. The loan to value ratio compares the value of the loan to the value of the property. Hard money lenders like HML Investments typically lend up to 65% LTV and charge interest rates between 8-14%. This higher interest rate is a reflection of the added risk involved.
For more information about hard money loans, contact the specialists at HML Investments today!