BiggerPockets

Is there an advantage to Hard Money Loans over a Line of Credit at a bank? If I'm planning to buy SFH for a rental at 65% LTV, do light rehab carpet/paint, get it rented, then refi into conventional loan at 75% LTV.

If the Line of Credit is 9 or 10% versus HML which might be 4 points, plus $895 fee, and then 14%. Since most Investors do HML, there must be an advantage to that, maybe it not showing up on credit since they don't report?

if you use a line of credit there will not be a "mortgage" on the house, which means they are a cash sale, which means you will be limted to a percentage of what you paid for the house to finance, since you are not 'refinancing",,,

If you borrow the money from someone else, and they put a lein on the property, do the proper paperwork etc, you then have a mortgage to refinance,,,unfortunately you can't do a hard money loan to yourself

I agree with Jon. Also, depending on the hard money lender and the property itself, you may run into issues with the time frame. If you use a LOC, there shouldn't be any short-term constraints relating to when you pay it off.