Private Lending-Loan Extension

[Raj G.]

Can somebody please advise  what are generic financial terms for private lending(residential).

Like loan rate, what happens when loan matured and borrower wants few more months extension.

Thanks in advance.

[Jerel Ehlert]

Laws can and do vary a lot by state, determined by the state where the property is located. Check with your local lawyer. All this should be pre-negotiated up front, not on the back end.  If this is after the loan matures, it is up to the lender to determine if they want to extend or call the loan due.  If they allow an extension, lender determines what costs to the borrower to extend.  HMLs will sometimes charge 1-2 points or a fixed amount.

In Texas, there is a form filed in the real property records noting the new maturity date and any other modified terms.  Here, it must be notarized.