• Basically the term hard money refers to loans made on real estate outside of the normal bank and finance channels. Hard money lenders are most often private individuals or a small venture capital type group of lenders. Often they have made their own money buying and selling real estate and now work investing in other projects to keep their capital working. Some lend from their self directed IRA's or pension funds.
• Hard money is generally meant to be short term. Normally 1 year or less and sometimes even just a loan for a day or 2. Hard money can charge points, a point is 1% of the loan amount, or an interest rate. Often their is a combination of the 2. I typically pay 5% as a fee up front and 12% to 18% annual interest depending on the deal.
• Hard money is typically used for a real estate investment that has good equity and either needs to be funded quickly or does not qualify for conventional financing. Often the property is a bargain but the borrower does not have enough cash and credit to get a bank to lend on the deal. I have even had people buying for their own residence and need hard money as a bridge loan so they could close a deal before a deadline. A few days later permanent financing was in place to pay off the hard money lenders.
• The best place to find a hard money lender is through a real estate investing club. Most cities and even some rural areas have real estate investing groups that meet weekly or monthly to network. Hard money lenders often attend these groups or the investors who attend have connections to hard money lenders.
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If you would like the chance to work with me or one of my fellow real estate investor coaches and our advanced training programs, give us a call anytime to see if Dean's Real Estate Success Academy and our customized curriculum is a fit for you. Call us at 1-877-219-1474 ext. 125
• Basically the term hard money refers to loans made on real estate outside of the normal bank and finance channels. Hard money lenders are most often private individuals or a small venture capital type group of lenders. Often they have made their own money buying and selling real estate and now work investing in other projects to keep their capital working. Some lend from their self directed IRA's or pension funds.
• Hard money is generally meant to be short term. Normally 1 year or less and sometimes even just a loan for a day or 2. Hard money can charge points, a point is 1% of the loan amount, or an interest rate. Often their is a combination of the 2. I typically pay 5% as a fee up front and 12% to 18% annual interest depending on the deal.
• Hard money is typically used for a real estate investment that has good equity and either needs to be funded quickly or does not qualify for conventional financing. Often the property is a bargain but the borrower does not have enough cash and credit to get a bank to lend on the deal. I have even had people buying for their own residence and need hard money as a bridge loan so they could close a deal before a deadline. A few days later permanent financing was in place to pay off the hard money lenders.
• The best place to find a hard money lender is through a real estate investing club. Most cities and even some rural areas have real estate investing groups that meet weekly or monthly to network. Hard money lenders often attend these groups or the investors who attend have connections to hard money lenders.
If you would like the chance to work with me or one of my fellow real estate investor coaches and our advanced training programs, give us a call anytime to see if Dean's Real Estate Success Academy and our customized curriculum is a fit for you. Call us at 1-877-219-1474 ext. 125