What is a hard money loan?
A hard money loan is a short term loan, secured by an investment property (i.e., one used for business purposes only), designed to provide both the funds for purchase and also for the repairs. The benefit of using hard money is it allows you to leverage your money so you can borrow more with less down, close faster than with any other type of financing, and put another set of expert eyes on the property, lowering your risk and maximizing your return in the deal.
What is the average hard money loan duration?
Most hard money loans that are for rental properties pay off in 90 days or less. If the repairs are completed in 30 days or less, and you immediately get it rented, your tenant will be making your payments. We have actually had some clients refinance in under 45 days. On properties being flipped, the current average loan duration for our clients is 120 days.
How are we different from our competitors?
Competitor hard money programs are for 6 months and then the lender charges you extension fees if your loan goes beyond this timeframe. As much as you try to anticipate everything that can happen in a deal, things can pop up that you may not expect and you may be stuck in hard money for longer than you anticipated. Investmark Mortgage does not penalize our clients by charging them additional fees. We can actually structure our loans to go up to 18 months with no extension fees! There are many other ways in which we differ from our competitors, learn more here.
If you have other questions regarding hard money loans, why not check out our FAQs page