Hard Money Loans for Residential Real Estate Investors

Hard money loans are available for residential real estate investing.  Here’s what you need to know about these types of loans.

·       Credit scores of 650 or higher – some automated approvals allow for lower scores.  Approvals are driven by credit history and lender defined credit worthiness based on past open and closed credit accounts

·       Proof of income and assets MAY be required on a case by case basis.

·       Must have two years of real estate investing experience.

·       LTV is generally 65% of the value after repair.  Automated approvals may yield higher LTV ratios.  Some programs have LTVs up to 75% of the value after repair.

·       Points range from 5 pts to 8 pts and may be required to be paid at closing in some situations.

·       Closing costs can range from 1-2% of the loan amount.

·       Rates are currently in the 10% to 15% range and are generally due in 6 months.

For investors with a short-term quick turn strategy these loans can be the perfect solution to conserve capital and create profitable transactions.