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Pardon my ignorance. I know the basic of what a hard-money is but where does one go to get a hard-money loan?
It just seems like I watched too many mafia movies thinking if I missed a payment on a hard-money loan someone named Guido, with black shirt, white tie, and a hat will come and break my legs.
There are certain big investor individuals who are hard money lenders. You will need to talk around with your agent or mortgage loan officer friends if any to get connected.
I happened to talk to a hard money lender recently. I was discussing with my agent friend of how I was experiencing difficulty in securing financing for my home purchase and she suggested a hard money lender in CT.
I was also very curious and wanted to know how it works so after thinking over it over 5 days, I finally gave him a call.
I was told that generally he doesn't lend for primary home unless I put down 20% (I thought if I had the 20% to put down then why shouldn't I get the loan form bank, but it is mainly meant for persons who have very poor credit issues that they are unable to get loan from bank). He lends for investment properties with the property mortgaged to the lender and with a 10% interest on money lended and for a fixed term for few months when it is expected that the investor buying the property will renovate and sell the property and return the loan. To me, it seems hard money is an option for experienced investor who has the confidence and back up for paying the interest on time. Not sure about breaking legs but they have the note for your home and can easily and legally take possession of the house.
do i need to source my funds if i use hard money lending?
also when a listing says cash only. can i use hard money?
In most cases yes, cash or equivalent where they will not scrutinize the condition of the home. Hard money loan do require larger down payments, usually at least 50% down.
Talk to a local Hard Money Lender or at least a Hard money lender that has a consultant with boots on the ground in the market. Hard money is a great option to get quick funds, but you as the borrower will still need some cash on hand to close on the property. Happy to chat more if you wish.
Pardon my ignorance. I know the basic of what a hard-money is but where does one go to get a hard-money loan?
It just seems like I watched too many mafia movies thinking if I missed a payment on a hard-money loan someone named Guido, with black shirt, white tie, and a hat will come and break my legs.
Most listings that say cash only will allow you to use a hard money lender. They will want a proof of funds from a credible source. Or you probably will have to put the entire payment into escrow until the deal is complete.
Focus on "Hard." It is more relevant than "Money."
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