Hard money provides an alternative source for real estate loans to the programs offered by banks and other commercial lending institutions. Often using pooled funds from investors, private lenders offer short-term loans with a minimum of hassle and quick approval for quick-turn real estate investment projects or other temporary funding needs.
Only appropriate for commercial purposes (never for owner-occupants), hard money loans generally rely primarily on the value of a property to qualify the loan opportunity, as long as the borrower can provide evidence that he or she will have the capability to repay the loan in the time specified. Many successful entrepreneurs undertaking fix-and-flip projects make use of private lenders to provide the financing they need to operate a profitable business.
Our easy lending process starts with your simple loan application (click Here to download), with no sensitive personal information required. Our first step in reviewing your application will be to validate the value you estimate for your property in its finished condition (after repair value, or ARV). We will then review your description of your project or other use of the funds to understand how you plan to complete it and sell it to pay off the loan and earn your profit. After asking you for additional details that might be needed, we will offer you terms for your loan and an estimate of all of the expenses involved.. If you find our terms acceptable, we will visit the property for a quick inspection and then start the closing process. Of course, if we find anything that concerns us about the property based on our experience, we will point that out to you immediately. The whole process can be completed in a week to ten days.
Once the loan (and your purchase, if applicable) is closed, you will be asked to make a monthly interest-only payment until you are ready to sell and pay off the loan. You may set the time frame for the loan up to one year, with shorter terms generally enjoying a cost advantage over longer ones. You are always welcome to pay your loan offer early, with no prepayment penalty.