Some Hard Money Questions?

Financing, Hard Money Lenders, Private Money
1

Hello to all,

I hope everyone is doing well.

I hope someone can put some more light on this topic?

I have not worked with Hard Money as of yet, and I am searching around for some folks to work with.

One person today in Houston told me they do Hard Money Lending in my area (Philadelphia) and they charge 7 points upfront, and then 16% intrest only on the money for 60 days.

They loan 65% of Fair Market Value.

Is this a good deal? ???

Is this the going rate and terms? ???

What questions should I ask of them and what do I look out for? ???

What experiences, good or bad have you had with hard money lenders? ???

Any Feedback is helpful. :slight_smile:

Thanks

2

Wallace,
To your first question, I would have to say that your deal is on the high side. It sounds like you asked a lot of the most important questions. You may want to confirm what I think is likely in that after 60 days they will want another 5-7 points to extend your loan. My advise is in looking for a hard money lender, look for someone that you feel is going to partner up with you. Just out of curiosity, who is the HML in Houston? I will probably be able to tell you if they are a true hard money lender or if they are a firm that brokers the deals.

3

Hello to all,

I hope everyone is doing well.

I hope someone can put some more light on this topic?

I have not worked with Hard Money as of yet, and I am searching around for some folks to work with.

One person today in Houston told me they do Hard Money Lending in my area (Philadelphia) and they charge 7 points upfront, and then 16% intrest only on the money for 60 days.

7 points upfrount is high the usual is 3-5 points upfornt

They loan 65% of Fair Market Value.

Is this a good deal?

You can do better 65-80% is the range

Is this the going rate and terms?

You can get 0 points for 18% for the same LTV

the range is 11-21% and most are in the range of 12-18%

What questions should I ask of them and what do I look out for?

Well look out for point higher than 5% that is not the going rate

What experiences, good or bad have you had with hard money lenders?

Bad experience pre payment pentlies I do not like that especially at that rate so look for ones that do not have PPP
Any Feedback is helpful.

Thanks

4

Thanks so much, now just gotta find someone I can work with and trust with Hard Money Lending ???

5