Investor · Maui, HI · Member since 2009 · 13k+ posts · 3k+ votes
Just curious, what do other people out there in Bigger Pockets land pay for Hard Money these days?
My main lender is 10 points, 10% APR, 2 year notes, LTV depends on the situation but usually around 75% ARV or cross-collateralizing another property for 100% ARV.
Lender · Tyngsboro, MA · Member since 2009 · 3k+ posts · 2k+ votes
14y
Hard money varies considerably by location. So what one person pays in Oklahoma is likely not available in Florida.
My rates go from 11% interest and 5 points, to 14% interest and 2 points. Rates are deal and borrower dependent. The less cash you have in the deal, the higher the rates. Experience matters, as does the location of the property.
Standard hard money rates in MA and NH start at 14% and 4 points and vary up and down by deal. Although having said that, the terms "standard" and "hard money" are contradictions in terms.
In addition, the national "hard money" companies typically have higher rates to compensate for the lack of local knowledge.
Rental Property Investor · Redding, CA · Member since 2010 · 91 posts · 7 votes
16y
Brandon: I don't feel your lender is out of line. You just have to make sure that the deal you do is worth the points, fees and related cost you pay. EAB
Investor · Maui, HI · Member since 2009 · 13k+ posts · 3k+ votes
16y
Andrew - if you are looking for a hml, I think the best way is to talk to real estate agents/brokers. Especially the ones who sell a lot of REO's. They know which HML's that investors are using, and they would love to get you acquainted and sell you some property too. Good luck!
Centennial, CO · Member since 2009 · 758 posts · 251 votes
16y
I do not lend hard money but come across a handful of them in the business. It seems here in Denver that 15% and 4-5 pts has become a bit more standard, but also for 6-9 month deals. 10 pts. seems a bit high, but it is hard to find two year hard money and I suspect different markets will vary drastically. Many have not survived the last two years and those left playing are more careful and expensive. Check out your local REIA. You might find a better deal. Also George Bloom and Joel Sorfenko on here are hard money brokers.
Investor · Aurora, CO · Member since 2009 · 200 posts · 74 votes
16y
Originally posted by Ted Akers:
I do not lend hard money but come across a handful of them in the business. It seems here in Denver that 15% and 4-5 pts has become a bit more standard, but also for 6-9 month deals. 10 pts. seems a bit high, but it is hard to find two year hard money and I suspect different markets will vary drastically. Many have not survived the last two years and those left playing are more careful and expensive. Check out your local REIA. You might find a better deal. Also George Bloom and Joel Sorfenko on here are hard money brokers.
Ted has a lot more insight into Denver then I do, but I have found similar 15% and 3-4 points. There is one lender for both AZ and CO that lends 75-85% of purchase and repair at 12% and 1.5 points. But they do require "skin" in the game.
Investor · Maui, HI · Member since 2009 · 13k+ posts · 3k+ votes
16y
I know a guy who does 2 and 2 - meaning 2 percent per month and 2 points down. thats more than 24% apr. Thats crazy, but I suppose on a super fast flip, the 2 points would be nice.
Investor · Southern CT, CT · Member since 2010 · 211 posts · 41 votes
16y
I always advise to start at the local Reia. When i moved to CT i found two private lenders from the REIA and they have good rates. 12% and 4pts for loans below 100k, 3pts for loans above 100k. terms are 6mos with possibility to extend to 1yr.
Happy Investing!
Investor · Round Rock, TX · Member since 2010 · 8k+ posts · 4k+ votes
16y
5 points, 15%
90% LTC and standard closing fees
Expensive, but well worth it for the right deals.
We also have 12% DOT private money investors for longer money usage, but we always consume the money much quicker than we can raise it. They lend 100% and even do 2nds in some instances.
Littleton, CO · Member since 2012 · 4 posts · 0 votes
14y
Have rates gone down? I see Good Funds Lending (in Denver?) is offering 3% origination and interest of 12% (I think ~12.7% compounded) with only $200 application fee with no doc fees or appraisal fees. Are there other HMLs with better rates?
Developer · Houston, TX · Member since 2008 · 488 posts · 121 votes
14y
Zeus Mortgage out of Houston, Tx. I'm not sure if the lend outside of town. It is by far the best terms I've had with a hard money lender.
The loan officer told me they have 3 tiers of lending terms. The terms get better as the more capital you have / less risk to the lender.
I think in order to qualify for the terms I've used, he mentioned you need $300k in assets and some liquidity. I'm not sure what else the requirements were. I'm sure it has something to do with credit report, etc. They also ask you how many rehabs you've done.
My previous lender was 4 points, 14% 6 mo. note 70% ltv, $500 appraisal fee. Got rid of them fast.
Flipper/Rehabber · Los Angeles, CA · Member since 2009 · 1k+ posts · 732 votes
14y
Oh ok thank you. I guess that makes a little more sense that the terms would be good if their requirements are relatively strict. They sound like a great lender though, and I am sure you are happy that you aren't paying 4point + 14%.