True Hard Money Loan Options
True Hard Money Loan Options
FBC Funding has True Hard Money Loan Options. We can facilitate funding True Hard Money Loan options. True Hard Money loans are pure asset based lending with little or no requirements based on the borrowers credit, experience, or liquid assets. These loans are based primarily on the equity of the real estate as collateral for the loan. If you have a property with a lot of equity there is a good chance we can get funding for you.
True Hard Money Loan Options
Here are some reasons borrowers choose True Hard Money Loans even with higher rates and points.
- Foreclosure Bailout
- Maturity Bailout
- Construction Bailout
- 100% Purchase CLTV (seller second mortgage)
- Non Cash Flowing Property
- Poor Credit – Great Property
- IRS
- Creative Financing
- ETC
True Hard Money Loans Are Risky Business
Lenders who fund True Hard Money Loan Options are taking a big risk. By funding deals for borrowers who have poor credit it is a greater risk. By funding deals for borrowers with little or no recent and similar experience it is a greater risk. By funding deals for borrowers with little or no verifiable, sourced or seasoned funds it is a greater risk. Any one of these factors would be a reason why an institutional Hard Money Lender would not fund these deals. Many deals have many if not all of these negative factors and they may still get funded based on the collateral type and the equity in that collateral. Because these are extremely risky loans, they are more expensive. Higher rates, higher points and higher fees are usual for True Hard Money Loan Options.
True Hard Money Loan Options Qualifications
The qualifications are simple. The collateral makes the deal. The property type, the property condition, and the loan to value (LTV) are the primary qualifications. A secondary qualification is the exit strategy. Contrary to popular belief most True Hard Money Lenders do not want the collateral. Yes every deal must have very good equity and be an extremely marketable property. That is only because the these are very risky investments and the lender needs to protect their funds.
- ACCEPTABLE PROPERTY TYPES INCLUDE: Residential 1-4 unit properties, Residential Multifamily 5+ unit properties, Mixed Use properties, Office, Retail, Warehouse and light industrial properties. Each loan is made on a case by case basis with an understanding that the viability and marketability of the collateral determines the deal. As such our true hard money programs will accept these and other property types (except vacant land) but will take a close look at the property and base their funding on the quick sale as is value of the property. The maximum loan to value is 65% for Residential 1-4 unit properties and Residential Multifamily 5+ unit properties, 60% for Warehouse and Mixed Use properties and case by case on all other property types.
- Acceptable Exit Strategies Include: Renovate and Refinance or Sell but there must be a believable verifiable plan to accomplish what your goal is. Lender will determine if it your exit strategy is viable.
These are the only 2 qualifying factors. Is you property acceptable and does the borrower have a viable exit strategy. Beside that the lender will assess the risk and the LTV offered as well as points and fees will be dictated by the risk.
True Hard Money Loan Options Costs
As a minimum expect to pay an interest rate of at least 12% to 15% or higher. As a minimum expect to pay points of 6% to 10%. Expect to pay for title, appraisal (or BPO) processing, underwriting and closing fees. On refinances, other than the appraisal fee, many of these fees can be rolled into the loan up to the maximum LTV. An Interest reserve escrow can sometimes be added to the loan up to the maximum LTV.
FBC Funding can facilitate True Hard Money Funding for the right property with a viable exit strategy. For the lender the return and LTV must equal the risk. For the borrower the higher cost must be financially worth the loan. If this is the case, call 888-848-3114
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