The world of real estate can seem like a complex place. There’s so much to learn about; what determines a property’s value, local pricing trends, early indicators of market changes, and we haven’t even started talking about financing! If you’re just starting out as a real estate investor, you’ve probably heard a lot of new terms, like “hard money” loans. You may be wondering, “What is a hard money loan?” and “Who benefits from hard money loans?” Brass Financial Group is here to help explain.
What is a Hard Money Loan?
Contrary to the name, hard money loans aren’t hard to get. Because it’s asset-based financing, loan applicants don’t have to worry about their credit, income, or employment status. They simply have to contact the lender and discuss the project they have planned and the property they’d like to buy. The application is simple and there’s no red tape. One of the features that makes hard money loans so desirable is the streamlined application process. You can go from your initial application to approval and cash in your hand in as little as 7 days.
Who Uses a Hard Money Loan?
The ideal candidate for a hard money loan is a real estate investor who is looking to:
- Flip a house
- Buy a house that’s being foreclosed upon
- Purchase and rehab a property for rental income
- Buy an investment property
There are also instances when it makes sense to use a hard money loan to facilitate a personal purchase. If you’ve found your dream home and are having a hard time securing traditional financing, using a hard money loan as a bridge loan is good way to get the house you want when you want it.
At Brass Financial Group, we make sure our hard money loans always have competitive terms. Our rates are between 10% and 14% for 1-2 year loans with a 70% loan-to-value ratio. Now that you know the answer to, “What is a hard money loan?” you can learn more about our financing options or get started with your application today.