Category: Business and Economy: Financial Services: Loans

Today many homeowners are staring foreclosure head on. Many of these home owners have been turned down by mortgage brokers and banks and are left feeling helpless. Turning to a hard money lender to save their homes is sometimes the only choice for homeowners in a foreclosure situation!Hard money home loans are equity based loans that are funded by private investment groups or individuals. Hard money home loans often come with very high interest rates and fees. The average interest rate for a hard money loan is 16% and many lenders charge up to five percent of the loan amount as a loan origination/loan funding fee. Hard money lenders will also only lend on properties with sufficient equity, the typical hard money loan is 50-70% Loan to Value of the property.Hard money lenders generally do not care about credit score or mortgage payment history, they only care that you make enough money to pay the loan every month and that the equity is sufficient to protect them financially if you default. Many hard money home loans can close in as little as a few days and are much faster then a standard mortgage loan. Hard Money loans are perfect for borrowers who may be facing foreclosure, borrowers with credit scores under 500 or property investors that need to buy property fast and cannot wait for traditional financing.Hard money home loans are meant to be used as short term financial quick fixes and not as long term home financing solutions. The idea of hard money loans are to clean up your credit and refinance your mortgage into a cheaper standard home. Although the interest rates and loan fees are high hard money loans can keep you from losing your home and any equity you have built up!