Investors Investing In Hard Money Loans
Investing in Hard Money Loans can be a safe and lucrative way of investing your money because as a hard money lender, your investment is secured by real estate. Most hard money lenders require that the hard money loan borrower have skin in the game and require at least 35% equity. On a hard money purchase mortgage loan, hard money lenders require that the property investor put at least 35% down payment. On a refinance hard money loan transaction, the hard money lender requires that the hard money loan borrower have at least a 65% loan to value. Investing in hard money loans can be very lucrative and investors investing in hard money loans can easily get double digit annual returns on their money that is secured by real estate.
Investing In Hard Money Loans: Purchase Hard Money Loans
Days of state income loans are long gone and there are no signs of ever coming back. The 2008 Real Estate and Market Collapse has totally wiped out most fix, rehab, flip mortgage lenders and this caused a stand still for real estate investors, real estate developers, and property rehabbers. Many property flippers rely on cash to purchase a property, fix, and flip and use the proceeds from the flip to do another project. Now that is not the case. Due to Hard Money lenders and/or Private Money lenders, real estate investors, real estate developers, and property rehabbers can turn to hard money lenders for short term financing so they can acquire property, fix them, sell them for a profit or refinance them for an end loan and keep them as rentals. Most hard money lenders require 35% down payment on a hard money purchase loan transaction. Most hard money lenders do not have pre-payment penalties and all hard money lenders expect an exit strategy on all of their borrowers. You do not want a hard money loan for a 30 year fixed period term. Hard Money Loans are used for short term bridge financing.
Investing In Hard Money Loans: Refinance Mortgage Loans
Many property owners have investment properties that have equity but need work and/or is not financeable due to needing repairs. Banks and traditional commercial lenders will not lend on a property that does not generate any income or is in need of major repairs no matter how good the borrower’s credit is. This is how you can utilize the services of a hard money lender and/or private money lender. You can utilize the services of a hard money lender to get short term bridge financing to repair your property and get it stablilized. Once stabilized, you can seek the services of an end lender, such as Gustan Cho Associates, and get a long term low interest rate traditional conforming commercial loan.
All Hard Money Lenders want to know the borrower’s exit strategy. Hard Money Lenders are short term lenders and do not want to keep the loan in their books for long term. Most hard money lenders want to keep the loan in their books from one year to three years. Example of exit strategies may be just to buy, fix, and flip. Other times may be to buy, fix, and refinance to an end lender and keep the property as a income producing income property. Other exit strategies may just be to purchase a fixer upper, not do anything to it and just resell it for a small profit as a fixer upper flip to another investor.
Investing In Hard Money Loans With Hard Money Capital Group
Hard Money Capital Group is the premier hard money and private money lender in the country. Hard Money Capital Group is different than other hard money lender because they offer full service from originating, underwriting, funding, and servicing hard money loans to helping the hard money borrower with the end financing through its preferred end lenders. Hard Money Capital Group will assist the hard money borrower re-establish their credit if the borrower has bad credit or lower credit scores or for self employed borrowers, we will assist in helping you to structure your tax returns the correct way so you do not overly write off too many expenses so you can qualify for a mortgage loan. If you are looking for a phenomenal conservative investment, investing in hard money loans may be a great idea. Gustan Cho nor The Money Store offers hard money loans and this article on Hard Money Loans and Hard Money Capital Group is just for informational purposes only. MLD MORTGAGE INC dba THE MONEY STORE does not offer nor endorse nor approve any hard money loans and has absolutely no connections with hard money lenders and has no associations with Hard Money Capital Group.