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Hard Money Loans

What is a Hard Money Loan?

Hard money loans are short-term loans backed by property.

With a regular mortgage, banks check your “soft” qualifications, such as your credit history and debt-to-income ratio.

Hard money lenders look at the profitability of the deal that you bring them.

They are used primarily by real estate investors.

Hard money lenders have looser requirements, and therefore can lend on fixer-upper properties that a traditional bank would likely pass on.

Because they are short-term loans (usually 5-12 months), hard money lenders require higher interest in order to make the risk worthwhile.

However, hard money lenders fund deals much faster, a key reason they’re popular with real estate investors.

What is a hard money loan?

Hard Money Lenders Versus Conventional Lenders:

Length of Loan – Hard money lenders typically have loan terms of 5-12 months, and occasionally up to 24 months for big projects. Our loan term is 5 months. A conventional lender, like for the mortgage on your house, will usually be a 30 year term loan.

Interest Rates – Hard money lenders typically charge 10% – 18% in interest rates. Conventional loans are much cheaper because they are collecting interest on your loan for much longer. Rates fluctuate, but they are often between 3% and 7% on the high side.

Speed To Funding – Conventional loans usually take around 45-60 days to close, while a hard money lender can often close in 10-15 days.

Loan Requirements – Hard money lenders can decide on their own hard cash loan requirements, but they usually have less strict credit requirements and don’t look at your income, job history, or debt. As long as you have a deal with profit potential, you can likely get a loan. A conventional lender is interested in your ability to pay month after month for 30 years, so naturally they’ll look at credit, income, debt, etc.

Hard Money Lenders Versus Conventional Lenders

Hard Money Versus Private Money:

Private money lenders are typically individuals that lend on a wide variety of investments, not just real estate.

Since it’s usually an agreement between you and a single person, you can create whatever terms make sense for both parties.

Hard money lenders are real estate focused, and are offered by companies.

They’ll have lending requirements, standard loan options, and set interest rates.

However, they’ll usually have more structured support and resources to help you throughout the deal.

Hard Money Versus Private Money

Common Hard Money Loan Costs:

- Origination Fee

- Broker Fee

- Application Fee

- Underwriting Fee

- Document Prep Fee

- Processing Fee

- Funding Fee

Those are fees that are usually required up front, and then during the loan you’ll have interest and extension fees (if applicable) to pay.

However, The Investor's Edge does not require any payments during the 5-month hard loan term. This helps investors with less cash on hand to make it through the deal and pay the interest out of the profit.

Furthermore, 37% of deals we lend on require $0 cash-to-close. This means that the loan amount covers those fees listed above, and no money is required out of pocket except for earnest money, loan extensions, or any cost overruns in the rehab.

Common Hard Money Loan Costs

Deal Types Funded With Hard Money Loans:

Fix and Flip – These are by far the most common type of deals funded with hard money loans. You can get funding on rundown properties that a conventional loan wouldn’t touch.

BRRR – Buy, Rehab, Rent, Refinance. Once you complete the rehab, you’ll find a renter and refinance the loan with a conventional lender instead of selling the flip. It’s a cost effective way to get a fixed-up rental property.

Wholesale – Wholesale deals don’t require you to receive funding, but the person you assign the contract to likely needs hard money. We can help facilitate wholesale deals by sending your deal out to our buyers list.

Deal Types Funded With Hard Money Loans
37% of loans are 100% Financed
800 Plus 5-Star Reviews
Average Cash To Close

Why First Time Flippers Choose The Investor's Edge:

No other lender makes it easier for a fix and flipper with no experience to get funds. We don’t require any previous flips in order for you to get started. We also don’t have a credit score requirement and with our 100% financing loan, you can complete deals with $0 cash-to-close. 

We also assign a Loan Advisor to you so you have a single point of contact about your deal and funding for it.

You’ll also have a dedicated Project Manager assigned to help you through the rehab project. All of our Project Managers are former general contractors who can help you keep the project on budget and on time.

Why First Time Flippers Choose The Investor's Edge:

We Help Our Members Minimize Risk So They Can Maximize Profits:

Put simply, we’ll keep you out of bad deals. Our 2-step evaluation process starts with a Desktop Evaluation. A member of our team will pull up property details, pictures, the neighborhood, and good comps. They’ll determine a likely after repair value (ARV) for your property.

If the numbers make sense, we’ll send your deal over to a local, 3rd party expert who knows the area to put together an ARV as well. 

All of this means that if the deal is a bad one, it’s unlikely to get through our rigorous screening process. That means less time and money lost on bad deals and more resources you can put towards the good ones.

We Give You Loan Flexibility

With over 30 loan programs to choose from, we can find the option that works best for you.

Whether your goal is lowest cash-to-close, most profit, or lowest interest rate, we’ll make sure you get just what you need.

We Give You Loan Flixibility

We Provide The Resources To Make Finding and Closing Deals Easy:

We realized a long time ago that everyone benefits if we do everything we can to help you find deals. That’s why our CEO—longtime fix and flipper Ryan G. Wright—put together the world’s foremost system for real estate investors.

With over 100 training videos, dozens of downloadable resources (like scripts and postcard templates), and 5 pieces of software, we can help anyone become a successful flipper.

Our Investor’s Edge software has been especially useful, with its database of over 160 million properties and your ability to easily sort these into lists of likely fix and flip candidates. With a few more clicks, you can send them all postcards.

Even our experienced investors love how easy it is to find deals with our program.

We Provide The Resources To Make Finding and Closing Deals Easy

Loan Rates and Details:

No Minimum Credit Score
No Experience Required
Up To 100% Financing
Interest Rates Beginning at 12%
Origination As Low As 3.5%
Lend Up To 75% ARV (After Repair Value)
No Prepayment Penalties
No Payments For 5 Months

Choose The Investor's Edge

Investors choose us because they see that we want to help you, no matter your situation, succeed at real estate investing. Many come because they are excited about our 100% financing program, but then stay for multiple deals because of our commitment to them.

Between our deal-finding software, low-barrier funding, and dedicated team members, you won’t find another lender who makes it easier to find and close profitable deals, period.

Get Prequalified For 100% Financing Now

Fill out the application for a free pre-qualification consultation. We will discuss your financial goals, see if our 100% financing is a good fit to help your reach your goals, and then answer your questions.