Welcome to Gateway Online

 

 

 

 

 Please Visit theGateway Real Estate Inc Blog

 

When people ask, "What is hard money?" we define it as fast cash, non-conventional or private financing with private funds. Since hard money loans are not backed by governmental safeguards the stringent guidelines and documentation required are absent. As such, it is relatively easy to qualify.

 

Private money rates generally range from 10 to 15%. The rate is determined by looking at a combination of factors: (a) LTV ratio, (b) strength of borrower, (c) condition/desirability of property, (d) actual cash-in or real equity contributed by borrower.

 

Typically you will be charged 1 to 5 points based on the loan amount. Some of the hard money lenders will allow you to roll points into the loan. However, most other title and lender fees, or other closing costs, will have to be paid by you at closing.

 

You would be amazed how little credit is needed for these loans. For the most part the lender is looking to the value of the property to secure the loan.

 

Hard money is usually a short term loan from 6 months to 10 years.  Most of our lenders will provide loans of up to 70% of the LTV (loan to value) or 70% of the ARV after repair value for rehab projects.

 

Depending on the project and the paperwork required we can close a hard money loan in as little as 10 days.

 

Do you allow secondary financing or seller-held notes?
ABSOLUTELY! A hard money lender does not care about where you come up with the remaining money to buy the property, whether from a relative, seller held promissory note, or bank robbery (just kidding). Since the lender is in first lien position, his or her money will be the first amounts paid back upon foreclosure and, thus, doesn't care about the second note holder.

 

If you have a property or project and are looking for an alternative to conventional  fianancing.  Please fill out the form below, and one of our agents will contact you at our earliest convenience.