Hard money investor loans are provided by hard money lenders like Saxe Mortgage for purchase of real estate and for other such investments. Through hard money investor loans, fast access to capital is achieved for the purpose of real estate investment. In many circumstances, hard money investor loans prove to be a wise decision.
Borrowers have many questions and often doubts regarding hard money investor loans and due to these, they are not able to take any concrete decisions. The biggest reason for most of confusion is the understanding the difference between a hard money loan and the conventional mortgage loan.
Conventional mortgage loans are provided on the basis of credit rating, income etc. while hard money investor loans are the asset based loans. Funding is done in a quick manner in hard money investor loans and a person can expect to get funds for investing in real estate, at times in as less than 72 hours.
These loans are provided for commercial projects, residential units like single family homes and other types of real estate. Due to the qualifying requirements, hard money investor loans have higher rates as compared to conventional mortgages.
These rates may vary with the market. Higher interest rates on hard money investor loans have proved as restriction for many non astute investors. Smarter investors understand the time value of money and are less interested in the rate. Loan to value on hard money loans is normally <70%.
Repayment of hard money investor loans are also short as compared to conventional mortgages. Some programs have repayment period from 6-12 months and others up to five years. Hard money lender's requirements include vacant dwelling insurance, flood certificate, inspection etc. Costs regarding these as with conventional mortgages are the responsibility of the borrower. Hard money investor loans offered by many lenders also carry origination points. The credit check is one factor that has made hard money investor loans very popular. Although a credit check is done it is generally not for the score but to check for liens and judgements before offering asset based loans. These types of loans have attracted people with bad credit in huge numbers in making investments.
Minimum and maximum loan amount differs from one source to another. These may be $25000 and $1000000. Appraisals are often required by the hard money lenders for offering loans but can sometimes be waived if the loan is close to where the lender is.
Easy availability, and asset based lending are the key features of hard money investor loans. Call a Saxe Mortgage representative today to learn about these loans.