Residential Hard Money Loans
Washington Residential hard money loans are those offered by private lenders like
hedge funds, wealthy private individuals and small community based investment
companies. These hard money loans are based on the value of a collateralized
asset pledge by the borrower, compared to conventional loans that use
borrower credit history, tax returns and income statements as their
Washington Residential hard money loans are usually acquired from acquisitions,
refinancing, foreclosures and bankrupt individuals looking to rebuild
their credit history. The interest rates on these loans are high, but
it is quite cheaper & worthwhile considering the stern terms and
regulations, time frames and the closing costs of a conventional loan.
Washington hard money lenders offer interest rates 6%-8% higher than conventional
bank loans. People come under the impression that these loans are hard
to payback however these hard cash loans are beneficial for borrowers
who cannot find additional lending for renovations of residential property
before selling or putting it up for rent.
Washington Hard money lenders consider income producing properties such as apartments,
retail properties, industrial, office building, hotel, motels, medical
facilities and restaurants. There are though other non-income properties
that they consider investing into like land acquisitions, development
projects, construction sites, foreclosures and bankrupt properties.
Most private investors look for a safe and guaranteed investment, with
an above average return they could get from banks.
Washington Residential hard money loans are usually secured by 30-50 % equity from
Washington Hard Money Loans
Washington Residential hard money lenders never consider impractical aspects like
credit scores as a factor when assessing borrowers. If hard cash lenders
do require a credit report it’s most likely they want confirmation
that the borrower is not bankrupt, doesn’t have open judgments
against them or in foreclosure. These factors may not even budge the
lenders decision o underwrite the loan, but it may force them to raise
the interest rate and keep close monitoring.
When buying a property at a discount of availing a short sale, borrowers
can finance 100% of the cost using hard money loans. For instance buying
a $100,000 property for $50,000, the borrower can procure the entire
funding from a
Washington hard money lender making a loan at a 50% loan-to-value. This is something
a conventional lender will never do.
Usually private lenders check the future income generating ability of
a property, they are however more concerned about the current value
of the property. The value of the property at loan origination is a
very important number for the investor since this is the value they
will consider for collateral if the loan is not serviced and things
go the other way. Private lenders rarely approve vacant properties with
no rental income as prospect investments; however these types of properties
are favorite targets for private lenders.
The speed at which private hard cash loans are closed is maybe their
best advantage. Speed of closing the loan is a huge advantage for many
real estate investors, especially those buying properties in auctions,
short sales and discounts. When carried out properly a hard cash loan
process can be closed in 24 hours, usually it takes between 14 and 30
working days. Even the longest
Washington hard money lender timelines are less than a basic conventional loan.
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