Hard Money Real Estate Loans
When you need money quick, and you do not have tax returns, nor good credit, nor bank statements that that show the ability to repay the loan, and you have at least 25% equity.
Hard money loans are used to get cash quick, and private lenders are looking for ways to substantiate what your property is really worth. There is no credit pull, and the loan is based upon whether a private lender believes he is safe lending on your property based upon how much money he will lend and the evaluation of your real estate.
Example: Your property is worth 1,000,000, you have a loan of $300,000 and you need $400,000 cash. In this case the investor will lend $700,000 so that $300,000 pays off your first mortgage and the private money $750,000 mortgage is now in first place. The borrower now has $400,000 in cash. We charge 4 points plus all cost for originating our loans. 4 points times $750,000 is $30,000 for your loan origination fee, you will in addition have title/lender insurance, paid property taxes, title fees and property insurance to cover losses should damage occur to your property. The $1,000,000 real estate now has a loan of 75% LTV. There is no prepayment penalty.