5 Places To Find Hard Money Lenders

11:06:00 PM

Looking for a hard money lender or loan? Where can you find good hard money lender to work with? There are multiple ways to find a trusted hard money lender, bets way to find best opportunities to get a loan is doing research appropriate hard lenders in your area.

5 Places To Find Hard Money Lenders
Interest rates for hard money loans range from 10 – 15% depending on the specific lender and the perceived risk of the loan. Points can range anywhere from 2 – 4% of the total amount loaned. The interest rates and points may vary greatly depending on the loan to value ratio.

What is a hard loan?

A hard money loan is a specific type of asset-based loan financing through which a borrower receives funds secured by real property. Hard money loans are typically issued by private investors or companies.
If you are working with a real estate agent ask them if they can refer you to a hard money lender they have worked with before.

What Types of Deals Should Hard Money Loans Be Used For?

Hard money loans are not appropriate for all deals. When purchasing a primary residence with good credit, income history, and there are no issues such as a short sale or foreclosure, conventional financing through a bank is the best way to go if the borrower still has time to go through the lengthy approval process required by a bank. Hard money is your source of financing when banks are not an option or the loan is needed in a short period of time.

Generally speaking, people who seek out hard money lenders need cash quickly, and have poor credit (don’t qualify for a conventional loan). They also can have large equity built up in a property like a home which will may be taken into consideration for the hard loan.

Hard money loans typically are very large amounts. Hard money loans can range from $25,000 up to millions of dollars. How much money is actually lent depends entirely on specific circumstances of the loan seeker and the company/hard money lender.

 
Hard money loans are ideal for situations such as:

  • Fix and Flips 
  • Land Loans 
  • Construction Loans 
  • When the Buyer has credit issues. 
  • When a real estate investor needs to act quickly.

Who Should Use a Hard Money Loan?

Real estate investors choose to use hard money for many different reasons. The main reason is the ability of the hard money lender to fund the loan quickly. In most situations, hard money loans can be funded within a week. Compare that to the 30 – 45 days it takes to get a bank loan funded. The application process for a hard money loan generally takes a day or two and in some cases, a loan can be approved the same day. Good luck hearing back about a loan approval from your bank within the same week!

The ability to obtain funding at a much faster rate than a bank loan is a significant advantage for a real estate investor. Especially when the real estate investor is trying to acquire a property with many competing bids, a quick close with a hard money loan will get a seller’s attention and set their offer apart from the rest of the buyers offering slow conventional financing.

Another reason a borrower may choose to use a hard money loan is that they have been rejected by the banks for a conventional loan. Life doesn’t always go as planned. Short sales, foreclosures, credit issues… they happen. Another important thing banks need to see is income history. If a potential borrower recently started a new job, the bank may deny the loan request due to insufficient income history, even if the borrower makes a healthy income. Hard money lenders are able to look past these issues as long the loan be repaid and the borrower has enough equity invested in the property.

Here is a list of websites to find hard money lenders:

Note: This is simply a list of places/websites to locate hard money lenders. You’ll want to perform proper due diligence and research before seeking a hard money loan.

www.reiclub.com – A website that lists a collection of hard money lenders and companies. You’ll get to see which state they operate in with contact information, including website, email, and address information.

www.biggerpockets.com – Bigger Pockets is a more interactive and pleasant way to find hard money lenders. They have a map with yellow dots on them which indicate which states have hard money lenders in their directory. At the time of this writing, they have a total of 589 listings.

www.fairview.com – A commercial hard money lender who accepts people with all credit scores and have flexible terms for repayment.

www.scotsmanguide.com – A search engine for residential hard money lenders as well as commercial hard money lenders.


Once you have a good list of companies near you, next thing to do is compare various factors which will help you further slash down the number of considered options. 
Some options include the following:
  • Reputation - You can read reviews posted on their website, social media pages and group, forums, review sites, and more. 
  • Referral - If you are willing to share about your dilemma to a family, friend, co-worker or acquaintance, see if they can recommend any company they have personally acquired financial assistance from (or know someone who have done so) for a similar concern. 
  • Fees, Rates, and other Conditions - Compare the usual fees, interest rates, repayment period, and other conditions.
You will want to seek out hard money lenders that are local to your city or state. There are several hard money lending websites, directories, and “search engines” that list companies who provide these services. I’ve listed a few of them above.

What is the interest rate on a hard money loan?

The property and the experience of the borrower.
also affect the interest rate given by the hard money lender. One must be prepared for the loan fee charged on a hard money loan. Hard money lenders charge 2 to 10 points, or 2 to 10 percent of the loan amount, as a loan fee.


Who is a hard money lender?

A hard money lender can be an individual or company. They are people who specialize in lending money that is collateralize. Generally speaking, hard money loans are short term cash loans and the amount that is lent will depend on the value of the collateral. One of the more popular collateralize items is real estate property of all types.

Looking for a hard money lender or loan? Where can you find good hard money lender to work with?
However, hard money lenders will use just about any type of valuable property as collateral. Items such as airplanes, land, yachts and boats, vehicles, artwork, rare collections of anything, etc.

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