Hard money loans are a type of loan. It is secured by real property, which makes it unique from other types. They are also considered last-resort or short-term bridge loans. They are used in various real estate transactions.
Lenders can be individuals or companies. To easily get hard money loans; visit:https://taylormadelendingllc.com.
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The Key Takeaways
Below are some key features of these loans.
- They are used primarily for real estate transactions. This money is not from a bank but a company or an individual.
- This type of loan is usually granted for a very short time. This loan is intended to quickly collect money at a lower rate of LTV and higher price.
- Because these loans are not traditionally executed, funding times are usually very short.
- It is interesting to see that these loans are negotiated between the borrower (and the lender). These loans also use real estate collateral.
- Even though default may occur, the lender still makes a lot of money.
What is a Hard Money Loan?
Hard money loans are usually based on the property's value, not on the borrower’s creditworthiness. Private lenders and firms are more interested in this business than traditional lenders such as banks.
These loans can also be a great option for property flippers who plan to renovate and then sell their property. You might be concerned about the high cost of this loan.
The good news is that the loan will be paid back quickly, so the additional cost of this type of loan is not a problem. The loan will typically be granted for 1 to 3 years. They also offer many benefits.
This type of loan is also a great investment.