Hard Money Lending...

What exactly is "hard money"? It's a real estate loan you get from a non-traditional lender, secured by the property and not by you. Hard money interest rates range from 10% to 21%.

The lender also charges "points" (one point is one percent of the loan amount, usually financed into the deal), which can range from 2 to 6.

Why would someone use hard money? Because these lenders are concerned about the property you're buying, and not about you as a person. Typically, hard money lenders will loan you up to 75% of the after-repaired value of the property.

The benefit of using hard money instead of bank financing is if you buy a deal that is worth 75% or less of the after-repaired value of the property, you can get into the deal for no money down. Hard money lenders are not concerned about your credit rating! They are much easier to work with than banks.

For information on how you can maximize your financing flexibility, contact your Mahich Banc Inc hard money lending consultant.