The usual Loan-To-Value (LTV) ratio on hard money mortgage is
between 50-60% tops!
This means that if you have real estate with a Fair-Market-Value
of $200,000;
you can borrow somewhere between $100,000 and
$120,000
against the real estate as a first mortgage, or a second
mortgage.
Hard money mortgage rates, and second mortgage rates
are always high:
between 14%-24% and there are always points!
The
term varies from 1 year to 5 years.
The Annual Percentage Rate
APR is usually between 19%-28%!
The LTV on raw land and other non-income producing property is
usually 33%.
On land development deals the LTV can be higher.
Credit rating is not too important in a hard money
loan unless
the borrower is simply a chronic problem borrower
who is always behind on
all debt.
Real Estate appraisals are not too important during the first
year of ownership.
All mortgage loan decisions are made based on purchase price.
We have a bad credit mortgage program in which we will not
enter the first mortgage loan,
or second mortgage loan information with
any credit bureau! This will allow you to build up your credit
rating fast!!
Hard Money does not mean that we supply the money and you supply the brains!
It means you supply real estate as collateral
and we supply
the mortgage loan, second mortgage, or bad credit mortgage
loan!
In all 50 States we have many "Hard Money"
no-income
verification, no-credit check programs available
for commercial
real estate of any type, and for construction and land
developement.
Our typical loan in these situations is 40-50% of
the value of the real estate.
We do not place much emphasis on
credit history or ability to make monthly payments!
Many Hard
Money loans can be structured so that there are no monthly
payments.
If your hard money deal makes economic sense, and you
have plenty of collateral;
Let's Talk!
Here's what we don't want to hear:
(These examples are not meant to sound insulting. They are simply mentioned to save us both a lot of time and phone bill expense!)
(1) You bought a parcel of property last week for $10,000.
But
you got a great deal because you're a genius and the previous
owner is an idiot!
The property is really worth $38,000,000!
And
all you want to do is borrow a mere pittance of $400,000 against
the property.
(2) You're going to buy a distressed property for $5,000.
After you fix it up it will be worth $38,000,000.
You want a
$400,000 mortgage loan against the anticipated selling price.
(3) You have a chance to buy a CANNOT POSSIBLY MISS
business!
The last 9 people who owned the business went bankrupt
because they were all stupid!
Now all you need is a $400,000
mortgage loan
and in a short period of time the business will be
worth $38,000,000!
(4) You have an appraisal in your hand that states that a
piece of property is worth $38,000,000.
You can buy it for
$400,000.
You want a $600,000 mortgage loan from us.
$400,000 to
buy the property
and $200,000 for loose change to help with your
living expenses until your ship comes in!
A Hard Money mortgage loan does not mean that we will lend
you money
at a high rate if you do not have equity of your own
into the deal.
If you have enough equity in your real estate we
don't care if you're the Town Drunk
or your going to jail
in the morning!
Chances are; you are going to get a hard money
loan!
However, If you have no equity, and no money to put into a
deal;
you are simply not going to get a hard money mortgage loan.
You don't need us, you need Jiminey Cricket, or a partner
with some money!
We do not have any 100% finance programs!
