Hard Money Loan
What is a Hard Money Loan?
Hard money loans are typically used by real estate investors, developers, and flippers. Hard money loans can be arranged much more quickly than a loan through a traditional bank.
In some cases, Hard money lenders can issue funds in as little as 10 business days, while traditional banks have a wait time of 30 to 50 days for funding. Most hard money lenders can lend up to 65% to 75% of the property’s current value, and loan terms are generally short: six to 18 months.
Requirements
- Property Address
- Property Value/ Loan Amount
- Personal Financial Statement (PFS)
- Credit
- Schedule of Real Estate
- Purchase and Sale Agreement (PSA)
- Proof of Liquidity
Benefits
One advantage to a hard money loan is the approval process, which tends to be much quicker than applying for a mortgage or other traditional loan through a bank. The private investors who back the hard money loan can make decisions faster because the lender is focused on collateral rather than an applicant’s financial position.
Lenders spend less time combing through a loan application verifying income and reviewing financial documents, for example. If the borrower has an existing relationship with the lender, the process will be even smoother.
Hard loan investors aren’t as concerned with receiving repayment because there may be an even greater value and opportunity for them to resell the property themselves if the borrower defaults.
Questions? We have answers. Call Fred 714-583-6188
If you are interested in finding out if a Jumbo Loan is right for you, please contact us below, or fill out our pre-approval form. One of our experienced loan officers will be in touch.