Credit cards vs. hard $$ lenders

This is my first time on this board. . . usually over on the birddogging forum trying to learn all I can.

I have a question for you in the know regarding $. Today I got an offer for basically a fixed rate (5.9%) loan for amounts up to $35,000 from one of my credit card companies. I have great credit personally and was thinking of possibly using my own home equity down the line to do some deals. I carry no credit card balances, have no student loan debt, and the only debt I have now is my mortgage and a HELOC to pay off a car. I have about $19K on that HELOC that I want to first pay off with the eventually profits I will make. Then hopefully I can increase the line and use it for investing.

How many of you have used HELOCs, or credit card offers, or regular lending sources vs. Hard Money Lenders/private funds and what are the tips you could give me regarding this.

Thanks alot!

Hello, Your first choice is to always go with a traditional lender. The rates are better if your credit is good. A HML will have higher rates and is based on the project, not your credit. You should use a HML as a last resort.

HML’s should be a last resort. (sorry all you HML’s out there ;)) If you have access to better rates and it appears that you do. Take advantage of them.

Especially if you can have an open LOC. You can use this at any time.

Hello Everyone, Mdhaas, no offense taken. We are here to help those with questions. You are right, this is not a HML situation. Immy, save your money on the rates.

LOL…no only are rates better the interest on credit cards ar usually compounded…while mortgages are simple interest. Dont just look at the rate do the math.

Thanks for the advice. At this point, I’ve decided to double close or assign my contracts so I won’t be needed THAT much money. . . . yet :wink:

For a flip that will take about a month, do you agree it makes more sense to use a HML?

Hello, Depending on how fast you move on your loan, a HML could take up to a month to close.

I bought a rehab house on my credit card for $9000 with an introductory rate of 2.9% until April. This gives me time to fix it, sell it, or refinance it. im only about 3 weeks into the deal so i dont know how well its going to turn out as far as the credit card payments and all that. I am hoping to have the house done in 2 or 3 weeks, and sold within 2 months from now. I then want to try and get a credit increase, or find a place that i can essentially just pay cash for a house without paying closing costs.

Depending on the parameters of the loan and your creditworthiness.

Traditional lenders are underwriting in days or weeks now.