Hard Money Loan FAQ's
are private investor / hard money loans used?
A:The most common situations that a person will require a private investor
/ hard money loan is as follows: Recent Bankruptcy. Balloon payment on existing loan
is due now. Cannot verify income, tax returns, bank statements, etc. Need emergency cash
quickly. Odd or non-conforming types of properties, such as mixed use, multiple units,
apartments, land, etc.
Q: Why would a person invest in a hard money loan?
A: Most private investors understand the real estate market, real estate
loans and mortgages and are looking for a safe and secure investment with a return better
than what they will receive from the bank. Since this types of mortgages are secured by a
property with normally 30%- 50% equity, the investor is well protected and receives the
benefit of the higher interest rate return.
Q: Are most private investors / hard money lenders
trying to foreclose on your home to get the property?
A: No. Private investors / hard money lenders simply want a good return on
their investment but they will protect themselves from losing the investment by using the
equity in the property. This is a common misconception, private investors / hard money
lenders just want the payments made on time but if the borrower is having difficulty they
will insure that it will not be a long term problem.
Q: Do I need to provide all my documentation
regarding income, bills, etc?
A: This is dependent from investor to investor but typically you will only
need to provide minimum documentation to obtain the loan. Also these types of loans are a
true no income qualifier loan because you do not need to sign a 4506 or 8821 form.
Q: What if I am a home buyer with damaged or poor credit with a
low FICO score?
A: These types of loan are usually used by individuals with past, recent,
or current credit issues to rebuild their credit and eventually refinance to a more
traditional type loan. FICO scores are no reviewed or required for this type of loan. Get
your free credit report here.
Q: As a Mortgage Broker / Banker, can I obtain a private
investor loan for my borrower and still receive a commission?
A: Yes, in fact, most loans funded by private investors where originally
originated and packaged by a mortgage broker or banker who earned a commission from a loan
that they could not previously close with traditional wholesale lenders and investors.
Thank you for visiting.
Equal Opportunity Lender. No APR quoted. All programs
subject to qualification.
Hard-Money-Loans.Com © Jessie J.
Beaudoin Last revised:
June 16, 2005