Private Hard Money
A private or hard money mortgage is a loan provided by an individual or group, rather than a formal financial institution, without the usual lending requirements and guidelines. The main requirement to qualify for this type of mortgage is often based on the amount of equity or rehabilitation potential of the property, making it a great choice for investors. Since private money mortgages are generally less stringent about financial risk and creditworthiness, they are ideal for borrowers who would otherwise have difficulty qualifying for other loans, or who want to close quickly and cannot wait for a long qualification process.
Granted, private/hard money loans usually charge fees or entail other terms to compensate for their otherwise lax qualifications. There is a lot of risk involved if you don’t know where to look and what to look for, but Legacy Park Mortgage can show you the way with honest and personalized advice.
Private Money Program Highlights:
- Minimum loan amount of $75,000
- Rates from 8.5% – 11%, Interest only
- 2-4 points
- 75% max LTV
- Purchase, Refinance or Cash-out
- Term from 6 months – 3 years
- Investment and owner occupied
- All property types considered
- Residential & Commercial
- Close from 7-10 business days
- Escrow for taxes and insurance not always required
- Pre-payment is case by case basis
- Foreign Nationals allowed
Who Needs Private Money?
- Borrowers who need money fast:
- To cash out equity for another business venture
- To refinance before a loan, or balloon becomes due
- To pay for urgent, unexpected bills
- Fix and Flippers
- Short term borrowers who have an exit strategy
- Borrowers who cannot qualify for a conventional loan:
- Borrower has poor credit
- Do not meet the DTI (Debt to Income) limits
- Do not have the 2 year job history
- Borrower is self-employed and cannot show enough recent income
- Borrower is a foreign national, with no SS or US status
- Borrowers who plan to refinance to a conventional, loan once they meet the qualifications
How the Process Works:
Preliminary Loan Approval: Once the loan request has been assessed and criteria met, a preliminary loan approval is sent with all the terms, and conditions of the loan.
Lien and title search: The attorney or title agent will conduct a lien and title to ensure there are no current mortgages, liens, judgements etc. against the subject property
Closing: The attorney or title agent will then record the mortgage, and disperse the funds.
Thinking About Becoming a Private Investor? Contact us at 305-570-2139 or email@example.com to learn more.