Hard Money Loans

What exactly is a Hard Money Loan? As if money can’t get any harder these days, all money should be so entitled to this description. Unemployment, college tuition, gas prices, mortgages. Should we just call all of it Hard Money and get it over with?

Actually, a Hard Money loan is a specific type of loan that is called upon when things about a property are just out of the box. A mobile home park in the middle of nowhere, but still a property that has excellent cash flow. Perhaps the owners have a history of bad credit, or maybe their credit scores dropped recently because of a medical problem. These are situations that would make a property owner seek out a Hard Money loan. Banks just don’t want to get their hands too dirty, so the loan committee just says NO.

This is not a business commercial loan given by banks for expansion of inventory purchase.

Where do you go? Uncle Louie? Your mom? This type of lender exists because of unusual circumstances and obtaining one, once a stigma,  is now considered a solid business decision. These types of loans are also referred to as Bridge Loans, which indicates short term money, thus bridging your present circumstance to a favorable outcome once financing is in place.

If you have a property that doesn’t meet the typical lender’s guidelines, you may be a candidate for Hard Money. Rates are higher and you will pay points up front, but normally the only concern is one of equity. Bad credit is overlooked in lieu of a property that will cash-flow and one able to make the payments.

Call us if you want to discuss Hard Money Loans.