Updated over 8 years ago on . Most recent reply
Hard money lender payment structure
Hello BP community, I'll be using the BRRRR strategy with my properties and considering hard money lenders. My questions are, how does a hard money lender expect repayment of the loan? In one lump sum after a pre determined amount of time or monthly payments, etc.? From your experience what are some common things to prepare for to secure a loan? I appreciate any information!
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It varies quite a bit. Many lenders collect monthly interest-only payments, some have a built-in reserve for either full or partial interest, and some may not collect any interest until the maturity of the loan (has to be a very strong deal for this to work).