Hard Money Real Estate Loans
The hard money loan is a type of short-term bridge loan or it can be said as an asset based loan financing by which borrower receives fund secured by the real property. The Hard money real estate loans are provided by companies or private investors. This type of loan in Hard Money Real Estate Loans is always backed by the value of property, not by the credit worthiness of the borrower of the loan. In this type of loan, the interest rates are higher than those of residential property or commercial loans, as higher risk is involved in it and has the shorter duration.
Mostly the Hard money real estate loans are used for the projects in Hard Money Real Estate Loans , which has the tenure of few months to few years. According to the lender and purpose of the loan, the qualifying criteria of hard money loan vary. The biggest loan value lies between 65% - 75% of the property value. These type of loans are very common in Canada and United States. The interest rates charged on the hard money loans are not dependent on the bank rate.
For applying for the hard money real estate loans, the process is totally different from that of the traditional loan from bank. As the lenders of hard money loans in Hard Money Real Estate Loans are private investors or companies, the fees and the closing costs are also covered by the borrower. The interest rate of hard money generally varies from 12 to 20 percent and they are provided more quickly than bank loans. Within two weeks, this type of loan is easily approved.
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