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  • Writer's picturePreston Morris

Louisiana Hard Money Loans

Do hard money lenders require down payment?

Although the amount required varies, most hard money lenders will ask for a down payment of anywhere from 10% to 50% --depending on the circumstances. It's important to note that hard money lenders do not make their money on property foreclosures and they are not in the business of flipping houses. Get to know more!

Do you pay monthly on a hard money loan?

Hard money loans come with similar payment structure as traditional commercial loans, albeit with a much shorter term. They usually come in 12 month terms up to 3 years, with an interest-only payment structure. This means you only need to pay interest costs every month for the entire term. Follow Us!

What is a hard money loan?

Hard money loans, also called bridge loans, are specialized lending instruments designed to assist real estate developers and house flippers who want to develop or renovate a property quickly and then sell it for a profit. These short-term loans are not generally available from traditional lending institutions, such as banks, but are offered instead by private lenders, including Investor Loan Source.

Hard money real estate investment loans are not based on a borrower’s creditworthiness, but instead base their loans on the value of the property itself. This asset-based lending model uses an estimate of “after-repair value” to determine loan amounts and terms. Our team of real estate experts know all the ins and outs of real estate values in Louisiana. We know that low interest rates and less money down leaves you with more money to fix and flip properties, minimizing your costs and maximizing your profits. Our speed and efficiency make us the perfect partner for your real estate investments.

If you’re looking for funding for real estate investments, fix and flip, rental, or even wrapable loans, Investor Loan Source is your first and final stop. Our loan specialists and experts work around the clock to deliver you the best offers and rates that everyone can afford. Whether it's your first buy and hold loan or if you’re a long-time borrower making a living flipping house after house, our team of dedicated experts are eager to get your call. If you’d prefer to stop by and make an appointment with one of our brokers, we have offices across the country ready and eager to jump-start your loan process.

What is an example of hard money?

Hard money (policy), currency backed by specie (as opposed to fiat currency) "Hard money" donations to candidates for political office (tightly regulated, as opposed to unregulated "soft money") ... Hard money loans, an asset-based loan financing secured by the value of a parcel of real estate.

What is needed for a hard money loan?

The main requirement for getting a hard money loan is having the required down payment or equity in a particular property to use as collateral for the loan. The minimum amount usually ranges from 25% to 30% for residential properties, and 30% to 40% for commercial ones.

How are hard money loans calculated?

Most hard money lenders calculate the amount you can borrow based on either the “as is value” of your property or the “After Repair Value” (ARV). You could borrow up to 80 percent of the ARV in at least one case. A loan based on the ARV can include the repair costs along with the purchase price.

How do you pay back a hard money lender?

Some hard money mortgage loans may include a balloon payment, which means that the loan principal will be due in full to the lender at the end of the loan term. If, for some reason, you are unable to repay the loan in full, you will need to refinance the loan or pay the penalties

How can I get out of a hard money loan?

Here are some hard money loan exit strategies you may want to consider.

  1. Sell the Property. One of the most common exit strategies for hard money loans is to sell the property. ...

  2. Refinance. ...

  3. Get New Loan. ...

  4. Traditional Mortgage. ...

  5. Subprime Mortgage. ...

  6. Use Business Capital.

Why do people get hard money loans?

Hard money loans are primarily used for real estate transactions and are money from an individual or company and not a bank. A hard money loan, usually taken out for a short time, is a way to raise money quickly but at a higher cost and lower LTV ratio.

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