Searching For a Reputable and Trusted Resource for Hard Money Loans? Private Money Utah Is Your Source!
How Does a Hard Money Lender Value My Property?
4 Apr 2012 | No Comments | posted by Corey Curwick Dutton | in Blog, Hard Money
How Does a Hard Money Lender Value My Property?
When making a loan, a bank and a hard money lender both have different opinions when it comes to determining the value of the property. A hard money lender takes a very conservative approach to property value. For example, the appraised value means nothing to the hard money lender. Instead, a hard money lender will determine the value of the property as if they had to sell it in 30 to 90 days. This is sometimes called a “fire sale” value. If a borrower defaults on a hard money loan, hard money lenders will be able to sell the property quickly at the “fire sale value” to recover their investment. For this reason, a hard money loan is usually in the range of 60-80% of the purchase price. For example, if you are buying a property for $100,000, a hard money lender will give you between $60,000 to $80,000 max of the purchase price.
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What Exactly Is a Hard Money Private Money Lender?
15 Mar 2012 | No Comments | posted by Corey Curwick Dutton | in Hard Money
Private Money is the Key for Success in Today's Market
There are two kinds of groups who have a growing need for hard money loans: commercial borrowers not eligible for bank loans, and real estate investors looking for foreclosures.
Hard money or private money to some is getting more popular by the minute as conventional (bank) financing for the real estate industry is still fairly scarce. As a wise borrower, there are rules to learn first before getting a hard money or private money loan.
When banks and brokers are not able to lend money to borrowers, the only option are the private money lenders. These days and with the economy, the demand is high particularly in places in GA, Chicago, NY, and NC.
What is a private money lender exactly? It’s the type of lender that doesn’t use conventional, bank standards in order to qualify a borrower for a loan. Evaluating credit history, income, and debt levels is typically of banks while the private hard money lenders will just provide a based on the value of the asset being used as collateral for the loan.
Real private hard money lenders are hard to find and their interest rates may not be as accommodating as compared to banks. But these lenders are the best option when the traditional financing from banks is not available or when a borrower is in need of a fast loan.
To read more ‘Hard Money 101‘ or to read about ‘Common Scams in Hard Money,’ click here
How to Avoid Lending Scams
11 Feb 2012 | 1 Comment | posted by Corey Curwick Dutton | in Hard Money
Mortgage scams and other lending scams are common in today’s tight credit markets. Banks aren’t lending and everyone is looking for private money loans to fund their investments and businesses. When the market demand is high for anything, there are always crooks in the marketplace that try to rip their customers off. In private money/hard money lending, there are plenty of lending scams everywhere you look. Here are 3 tips for avoiding popular lending scams:
- Run away from fee collectors: A lending scam is usually present if high, upfront fees are paid directly to the lender. A client asked me about hard money lenders in Utah and specifically about a lender I had never heard of. I suspected the reason I had never heard of this lender is because they are a lending scam that charges hefty upfront fees. The client confirmed this and said they asked him for $3,000 to underwrite a loan. This hard money lender in Utah is obviously running a lending scam so run away fast! Read more..
6 Steps To Close a Hard Money Loan Fast
4 Feb 2012 | 2 Comments | posted by Corey Curwick Dutton | in Hard Money
Because every hard money lender has different requirements, it is difficult to say all the items you will need. However, the good news is that there are standard items you’ll need to close a hard money loan fast:
- Find a Good Hard Money Broker: A good hard money broker is your friend because he or she already knows the real hard money lenders from the fake lenders and can steer you in the right direction for a fast hard money loan. This is not to say you should go to your standard mortgage broker for a hard money loan though. A standard mortgage broker is just going to send you to a hard money broker anyway and you’ll be paying double the loan fees because you’ll have to pay the standard mortgage broker a fee for referring you.
- Have a Preliminary Title Report ready: A hard money lender always wants to see clear Title to a property before lending on it. You can get a Preliminary Title Report or a “PR” from the Title company that will be handling the escrow for the seller of the property. If it’s a refinance loan, find a local Title company to obtain one.
- Get Your Property Documents Together: If it’s a rental property, you’ll need copies of the leases. Apartment complexes will need rent rolls and an Income Statement that shows the income and expenses for the property. Most lenders want to see an Income Statement for 2 years on the property. Read more..
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