Comments on: 10 Questions on Hard Money Loans http://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/ Learn, Network, Invest Sat, 11 Feb 2012 23:51:37 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: steve wernerhttp://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-98787 steve werner Thu, 10 Nov 2011 15:13:46 +0000 http://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-98787 Great explanation.People tend to get freaked out when they here the term Hard Money.A little education = a big opportunitysw Great explanation.

People tend to get freaked out when they here the term Hard Money.

A little education = a big opportunity

sw

]]> By: Hazel Wrighthttp://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-85361 Hazel Wright Wed, 11 Aug 2010 16:22:20 +0000 http://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-85361 I would still prefer hard money as a great alternative to banks. It's much convenient and fast! Though it's not easy to find the best hard money lenders to provide you with the right rate. I would still prefer hard money as a great alternative to banks. It’s much convenient and fast! Though it’s not easy to find the best hard money lenders to provide you with the right rate.

]]> By: Michael Murrayhttp://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-67211 Michael Murray Tue, 28 Jul 2009 23:56:17 +0000 http://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-67211 We sometimes make hard money loans. The information given has been quite good and quite accurate. Hard Money is sometimes easier to get (no qualifying can be available with good security)is much Harder as to terms i.e. interest, ARV, Points, Fees, overall cost compared to so called conventional or soft money...where terms and conditions are softer or easier on the borrower often because there are safeguards built into soft money loans that are significantly less risky than are the typical Hard Money Loans. Remember that Hard Money lenders take higher risks so they expect higher returns to offset those real risks. We sometimes make hard money loans. The information given has been quite good and quite accurate. Hard Money is sometimes easier to get (no qualifying can be available with good security)is much Harder as to terms i.e. interest, ARV, Points, Fees, overall cost compared to so called conventional or soft money…where terms and conditions are softer or easier on the borrower often because there are safeguards built into soft money loans that are significantly less risky than are the typical Hard Money Loans. Remember that Hard Money lenders take higher risks so they expect higher returns to offset those real risks.

]]> By: Shanehttp://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-60850 Shane Mon, 27 Oct 2008 05:36:35 +0000 http://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-60850 Good, it was just like reading the forum!! Anyhow these answers will help to remove Some doubts who wants to invest and to know about hard money.. Good, it was just like reading the forum!!
Anyhow these answers will help to remove Some doubts who wants to invest and to know about hard money..

]]> By: Jay Moneyhttp://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-59920 Jay Money Wed, 10 Sep 2008 01:04:01 +0000 http://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-59920 Too bad hard money is drying up. It's getting REALLY hard for borrowers to get ANY type of loan. The market right now is getting much worse in many parts of the country. Best of luck out there if you're looking for funding! Too bad hard money is drying up. It’s getting REALLY hard for borrowers to get ANY type of loan. The market right now is getting much worse in many parts of the country. Best of luck out there if you’re looking for funding!

]]> By: Susanhttp://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-59806 Susan Thu, 04 Sep 2008 10:46:45 +0000 http://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-59806 Excellent summary. A hard money loan can be a good option for short term with flexibility in interest rate and credit scores. Excellent summary. A hard money loan can be a good option for short term with flexibility in interest rate and credit scores.

]]> By: Paulhttp://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-58891 Paul Thu, 31 Jul 2008 21:10:00 +0000 http://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-58891 Hard money loans are a good idea if you need a short term loan. I agree with the person above about not holding them long term. Hard money loans are a good idea if you need a short term loan. I agree with the person above about not holding them long term.

]]> By: yanni razhttp://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-58553 yanni raz Tue, 22 Jul 2008 03:18:11 +0000 http://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-58553 First of all I want to make sure that you're familiar with the term Hard Money. Hard Money is Money Loaned to you by private investors, these private investors can be from anywhere but normally the Hard Money lenders would want to work within their own state, so if you're from California than you want to find an investor in California.So what type of Hard money loans the Hard Money Lenders will do?The First type of Hard Money Loans lenders are offering is Construction Hard Money Loan. In construction Hard Money Loan the Hard Money Lender will loan the borrower the money in stages, example: You own a land in Los Angeles California, on that Land you want to build a house, you have the Plans approved by the city of Los Angeles and you're all ready to go, now you need a Hard Money Loan because it will be easier to qualify and get the money you need for the construction. You will call a Hard Money Lender and give your information, the approved plans, your financials, your budgets for the construction(you can get it from your contractor), then lets say the Hard money Lender agrees to Loan you the money you need, but the way the Hard Money Lender will Loan you the money is by stages, and the stages are: When your Contractor will finish the foundation, the contractor will get paid after inspection that is done by the Hard Money Lender $10,000 for the foundation work. Than when your electrician finishes the electricity in the house, than the electrician will get paid after inspection done by the Hard Money Lender another $7000. You understand the concept? Everybody by the completion of the construction will get paid by the Hard Money Lender. Why the Hard Money Lender do that? Because he want to have control of the money, private investors know the risks they're taking but they're still willing to take these risks only if they have 100% control of the money.Why Hard Money Lender will choose to Loan money to Investors and not Homeowners?This is a very good question that a lot of people should know the answer for. The Hard money Lenders wouldn't want to have to take a homeowner out from his home because he didn't make the payments, but with investors it's different, it's 100% business and that's what the Hard money Lenders want- Business. What type of properties Hard money Lenders will Loan money on? A Hard money Lender will Loan money to many type of properties: Single Family Residents, Condos, Townhouses, Apartment Buildings, Hotels, Motels, Office Buildings, Shopping Centers and many others. What hard money Lenders don't like, it's Land. It will be very hard to find a Hard Money Lender that will Loan you money on a Land, and the reason is because there is no income to Lands, maybe you can get a Hard money Loan on a Golf Course or maybe a Land that you about to develop something on, but raw Land- Forget about it. Today Hard money Lenders Loan more money to Commercial Real Estate investors rather then to residential investors and the reason is Less risk. Today the Residential market is not going up, Values of Homes are actually going down by more than 30%, and every day more foreclosures are coming out on the market, so the Hard money Lenders are smart enough not to participate in taking risks with homeowners. Commercial Real Estate is still very competitive, investors are still buying properties, remodel properties and build new properties. The Commercial Real Estate market is still alive just like it was in the residential market 3 years ago, and Hard money Lenders are still in the game, and now they're busy more than ever because the Banks don't Loan money that easy to borrowers. So it's Commercial Properties rather than residential properties, and Construction Loans. Good Luck First of all I want to make sure that you’re familiar with the term Hard Money.
Hard Money is Money Loaned to you by private investors, these private investors can be from anywhere but normally the Hard Money lenders would want to work within their own state, so if you’re from California than you want to find an investor in California.

So what type of Hard money loans the Hard Money Lenders will do?

The First type of Hard Money Loans lenders are offering is Construction Hard Money Loan.
In construction Hard Money Loan the Hard Money Lender will loan the borrower the money in stages, example: You own a land in Los Angeles California, on that Land you want to build a house, you have the Plans approved by the city of Los Angeles and you’re all ready to go, now you need a Hard Money Loan because it will be easier to qualify and get the money you need for the construction.
You will call a Hard Money Lender and give your information, the approved plans, your financials, your budgets for the construction(you can get it from your contractor), then lets say the Hard money Lender agrees to Loan you the money you need, but the way the Hard Money Lender will Loan you the money is by stages, and the stages are:
When your Contractor will finish the foundation, the contractor will get paid after inspection that is done by the Hard Money Lender $10,000 for the foundation work. Than when your electrician finishes the electricity in the house, than the electrician will get paid after inspection done by the Hard Money Lender another $7000.
You understand the concept?
Everybody by the completion of the construction will get paid by the Hard Money Lender.
Why the Hard Money Lender do that?
Because he want to have control of the money, private investors know the risks they’re taking but they’re still willing to take these risks only if they have 100% control of the money.

Why Hard Money Lender will choose to Loan money to Investors and not Homeowners?

This is a very good question that a lot of people should know the answer for.
The Hard money Lenders wouldn’t want to have to take a homeowner out from his home because he didn’t make the payments, but with investors it’s different, it’s 100% business and that’s what the Hard money Lenders want- Business.
What type of properties Hard money Lenders will Loan money on?
A Hard money Lender will Loan money to many type of properties: Single Family Residents, Condos, Townhouses, Apartment Buildings, Hotels, Motels, Office Buildings, Shopping Centers and many others.
What hard money Lenders don’t like, it’s Land. It will be very hard to find a Hard Money Lender that will Loan you money on a Land, and the reason is because there is no income to Lands, maybe you can get a Hard money Loan on a Golf Course or maybe a Land that you about to develop something on, but raw Land- Forget about it.
Today Hard money Lenders Loan more money to Commercial Real Estate investors rather then to residential investors and the reason is Less risk.
Today the Residential market is not going up, Values of Homes are actually going down by more than 30%, and every day more foreclosures are coming out on the market, so the Hard money Lenders are smart enough not to participate in taking risks with homeowners.
Commercial Real Estate is still very competitive, investors are still buying properties, remodel properties and build new properties.
The Commercial Real Estate market is still alive just like it was in the residential market 3 years ago, and Hard money Lenders are still in the game, and now they’re busy more than ever because the Banks don’t Loan money that easy to borrowers.
So it’s Commercial Properties rather than residential properties, and Construction Loans.
Good Luck

]]> By: MoneyManhttp://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-55217 MoneyMan Thu, 13 Mar 2008 06:20:01 +0000 http://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-55217 Excellent tips Troy. Hard money loans are for a specific purpose and should be replaced with a conventional mortgage if your intention changes to a long term hold. Excellent tips Troy. Hard money loans are for a specific purpose and should be replaced with a conventional mortgage if your intention changes to a long term hold.

]]> By: Nadinehttp://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-54897 Nadine Thu, 28 Feb 2008 11:58:23 +0000 http://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-54897 Nice post...Great guidance before taking loan. Those are very clean and useful. Nice post…Great guidance before taking loan. Those are very clean and useful.

]]> By: Tomhttp://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-54781 Tom Sat, 23 Feb 2008 14:56:30 +0000 http://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-54781 Wow great article, i love your opinion! Wow great article, i love your opinion!

]]> By: Jim Boyerhttp://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-54758 Jim Boyer Fri, 22 Feb 2008 17:01:10 +0000 http://www.biggerpockets.com/renewsblog/2008/02/21/10-questions-on-hard-money-loans/#comment-54758 Nice article, I have used a hard money loan before. Not something that I would want to hold for more than a few months, but it worked well for a investment property that needed to be closed on in 6 days or it would be foreclosed on. Nice article, I have used a hard money loan before. Not something that I would want to hold for more than a few months, but it worked well for a investment property that needed to be closed on in 6 days or it would be foreclosed on.

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