What types of property do I have to own?
Most any property can used to obtain a hard money loan. Hard money lending standards have different qualifying requirements for each property category.
What is the interest rate for a hard money loan?
Most hard money loans have interest rates that range from 7% to 12% depending on 1) if the loan is a 1st or 2nd trust deed, 2) the borrower’s credit and income, and 3) the property’s condition and location.
What are the costs of a hard money loan?
Hard money loans have just about the same closing cost ranges that the big banks have with the exception of loan origination points that often range from 1-3 points. One point is equal to 1% of the loan amount.
What are the qualifying requirements?
Federal and state laws require that all lenders, including hard money lenders, verify the borrower’s “ability to pay” for all real estate loans. Since hard money loans are typically funded and arranged on income properties, the monthly rental income is looked at to provide the income to pay any proposed hard money loan.
What are the credit requirements?
Hard money loans can be obtained with most any FICO credit score since there are no specific minimum credit requirements. Since all hard money loans are not the same, the better the credit the better the interest rate.