Is borrowing on LTV real?

[Elenis Camargo]

Hi BP! I called several hard money lenders a few months ago and they all said they would lend 80% LTV but that their LTV is based on purchase price. Listening to BP podcasts and reading Brandon Turner’s book on investing with little to no money, I was under the impression hard money lenders would lend based on appraisal value, not purchase price. Does this not exist anymore? Thanks in advance!

[Ian Walsh]

Hard money lending is a generalized term at this point. True hard money lenders lend against the asset and the ARV . When companies are not lending against the ARV it is because their funds are institutionally backed and requires extensive bank underwriting. The funds they deploy are bank funds essentially.