Know About Hard Money Loan Interest Rates & Terms Before Applying

by Olivia Clark Finance Manager

Hard-money loans are short-term mortgages with no interest used by investors to buy and rehabilitate real estate in trouble. These loans have higher interest rates of up to 12%, but can be financed in 15 days, which helps investors to compete with all-cash buyers. If the property is turned on or permanent funding is obtained, the loan is usually refunded within 12 months.

If you are looking for the best way to quickly invest in a property, CCM finance offers hard cash loans, new home construction loans, home building loans for real estate investors looking to buy and renew properties. They offer competitive rates for first-class borrowers and can pre-qualify online in just a few minutes.

A hard-money loan is used to finance the acquisition and rehabilitation of investment properties. You can get hard money loans faster than traditional mortgages and the qualifications to apply hard money loan are more flexible. Hard money loans are mostly used by real estate investors to renovate their properties to buy and sell a property..

This means that regardless of the timeline of investment, investors use a hard money loan to buy and repurchase the property. During this time, you usually pay monthly interest only. Generally there is no prepayment penalty so that you can repay the loan at any time. After receiving and retrieving the property, you usually sell it and pay the original amount. However, long-term investors will use it for rehabilitation or weather, before refinancing and paying the hard money with new long-term loans.

If you want to see your project can be prequalified for the hard money loan? Receive pre-qualified online with CCM Finance in just a few minutes. After answering some questions about you, your experience and investment possessions are in your mind, CCM Finance will tell you about the exact rates and conditions that you already qualify for.

Hard Money Loan Rates, Terms and Conditions

Hard Money Loans have different differences in comparison to conventional mortgages, such as easy qualifications, high-interest rates, short credit conditions and small funding times. Hard money loans can be used for troubled properties as well as for single-family houses, apartment buildings, condos, etc.

Hard Money Loan Interest Rates and Other Charges

Specific hard money loan interest rates and fees are:

Interest rates: 7.5 – 12% (* depends on hard money lenders)

Lender fees: 2 - 10 points (* depends on hard money lenders)

For a hard money loan, the borrower needs to cover the closing costs, application fees, valuation fees, and any other costs related to the purchase of an asset. On the contrary, conventional mortgages generally offer lower interest rates between 4% - 6% and at least there is no lender duty, known as "numeral". One point is equal to 1% of the loan; Traditional mortgages are usually between 0 - 1 digits.

However, the borrowers of the traditional mortgage are also expected to cover closure costs, application fees, valuation fees, and any other costs that facilitate the transfer of property ownership. Interest rates on new home construction loans are comparatively higher due to short-term and are meant to compensate the hard money lender for the risk.

Hard Money Loan Eligibility and Needs

National best construction loan lenders have taken standardized loan qualifications for hard money loans:

550+ credit score
2 - 3 months of bank statement
Property Location and Purchase Price
Detailed experience of earlier projects

Where to Apply for Hard Money Loans

Hard money loans are usually got through local lenders or national and reputable online lenders. If You want to get pre-qualification with one of our recommended online countrywide hard money lenders today, look at the loan home. They offer competitive rates to key borrowers and you can pre-qualify in a few minutes.