Considering a Hard Money Equity Loan?
Do you know you can use the equity in personal and commercial properties you own and get cash through a loan? This loan term is known as a hard equity loan. Home equity loans, often abbreviated as HELOC, can help you pull cash out of your real estate property and use it for your investment needs.
Home equity loans work much like credit cards. When you need cash, you can obtain financing from a pre-approved loan. You can pay the full loan repayment amount right away or make loan payments, depending on the terms of your home equity loan. Best of all, you only pay interest on what you use.
A Hard Money Loan Is Ideal for Poor Credit Scores
Have you tried to get conventional financing for your home, only to find out the bank is not satisfied with your bad credit score? Getting denied money loans from a bank due to bad credit is highly stressful and may discourage your business efforts. Thankfully, home equity loans are easier to obtain than traditional financing, even for those with bad credit.
Because the lender is more focused on the value of the investment property, they will not focus as much on your poor credit score for loan approval. You can get approval for hard equity loans with poor credit, home foreclosures, bankruptcies, and late payments. Poor credit will not prevent you from getting the cash you need.
What Are the Interest Rates for Hard Money Equity Loans?
When seeking home equity loans from hard money equity lenders, one of the first things you need to learn about is the interest rate. What can you expect from the home loan terms? Does the home equity loan lending company offer fixed interest rates?
It is important to note that the rates on this type of equity lending are figured on a case-by-case basis. Because the lender is taking a bigger risk than banks, you will find the interest rates to be higher. Contact our partners today to discuss your options.
EXAMPLE LOAN SCENARIOS
Do Private Hard Money Loans Differ From Conventional Loans?
Traditional mortgage loans from traditional lenders vary in their term offerings. You may be offered a fixed rate, an adjustable rate, or one that is fully amortized. A conventional loan is repaid in full over the life of the loan. This loan can have lending periods of up to 40 years.
With equity loans from private investors like us, the period is much shorter, from around six months to five years. This home loan is interest-only, meaning you are only paying monthly payments to pay the interest on the loan. At the end of the term, you will pay a balloon payment to pay off the home equity loan term in full.
Possible Home Equity Loan Terms
Because these loans are decided on a case-by-case basis, the terms will vary according to the lender and borrower. The following offers some possibilities, but it is important to contact our partners right away for specifics on what they can offer you.
- The combined loan-to-value is capped by many lending companies at around 60%.
- Hard money HELOC loans are available for both first and second liens.
- Loan periods typically range from 6 to 36 months.
- Interest rates range between 10 to 30%, depending on your situation.
- Full appraisals are almost always required on a hard money home equity line of credit.
MORE EXAMPLE LOAN SCENARIOS
Understanding the Benefits of Working With Hard Money Lenders
Real estate investors will find many benefits in obtaining a hard money home equity loan. The following are some of the benefits we want you to explore.
- The loan terms are much more flexible for hard money home equity loans.
- You can get approval, even if you have been turned down by conventional lending companies.
- The approval and funding processes are fast.
- These equity lenders provide both emergency and bridge loans.
- You can use the cash for startups, cash flow, payroll, and the expansion of your business.
While the terms are much shorter and you will pay more in interest, avoiding the hassles of the bank process and the fast approval and funding make these home loans attractive to investors.
Get Your Pre-Approval Today!
Our partners are here to help you understand your home equity options. Most are a hard equity lender focusing on helping you get the cash you need for your home without the hassles banks put you through.
If you are interested in applying, we invite you to contact our partners immediately to get fast pre-approval. If you have any questions, they are available to answer them and guide you in your decision.
They are your go-to source for getting the cash you need for your home in less than two weeks, in most cases. These funding options put the power in your hands to better run your business and seek success. Let our trusted partners help you meet your goals.