Residential Hard Money Loans-
Better Loans & Realty has been in business since 2005 – and has funded Residential Hard Money Loans throughout the entire state of California. We understand your need for quick funding, at the best possible rate – to leverage your investment portfolio.
We take pride in offering some of the most competitive Residential Hard Money Loans on the West Coast. Our clients include: builders, real estate investors, contractors, business owners, entrepreneurs and real estate brokers. We fund a variety of residential properties – including: single family homes, condos, multi-units, luxury homes and historic mid-century homes. Our lending capacity starts at $50,000 and sits comfortably above $10,000,000. We work in Southern, Central and Northern, California – and our Residential Hard Money Loans have served most cities and towns in this wonderful state.
WHAT IS A RESIDENTIAL HARD MONEY LOAN?
A residential hard money loan is an equity based bridge loan. An equity based loan gives you more flexibility for qualifying, so you can refinance into permanent financing if needed. Our loans are a bridge to help you reach your real estate and business goals.
A Residential Hard Money Loan includes:
>A 1-3 year loan term
>Interest only monthly payments
>A prepayment penalty ranging from 3-6 months
>Prepaid interest at borrower’s request.
>A balloon payment due at the end of the term.
We ensure that our borrowers have a solid exit strategy, which could be: selling their property, acquiring permanent financing through traditional financing or paying off their hard money loan before the balloon payment is due.
WHO IS A HARD MONEY RESIDENTIAL LOAN FOR?
A hard money loan is a go-to loan for many real estate investors. Here are some reasons why someone would benefit from a residential hard money loan:
>You may want to get into a real estate project quickly and can’t wait 45-60 days for a conventional loan to go through. Time and money are of the essence and a hard money loan would benefit your profit margin in the long run.
>You own several properties and do not qualify for a conventional loan due to a high debt to income ratio.
>You had a Foreclosure or Bankruptcy in the past – or you have a low FICO score and do not qualify for conventional financing.
>You want to protect your asset and hold title in the name of a corporation or trust
>You want to cash-out some equity and use the funds to invest into your business or grow your real estate portfolio.
When we evaluate each loan, we look at all factors — ensuring that a hard money loan benefits the borrower in the long run.
WHO QUALIFIES FOR A RESIDENTIAL HARD MONEY LOAN?
To begin with, the property must be in California. Second, we look at the condition of the property and the amount of equity. We go up to 65% Loan-To-Value for residential real estate hard money purchases and 60% Loan-To-Value for residential hard money refinance loans.
Next, we look at the loan “purpose” and make sure that it is a “business purpose” loan. Business use or business purpose loans include: loans to purchase, repair or improve real property for use in the Borrower’s business. To acquire, improve or maintain non-owner occupied rental property — to purchase, improve or repair equipment; machinery, fixtures or furnishings used in Borrower’s business – for operating capital (e.g. employee salaries) or to purchase or pay for business inventory, supplies, rent, taxes, insurance, and other related expenses; or to pay off, refinance or consolidate business debt.
In addition, we factor in the size of the loan and if we feel that a larger loan will add more risk than security for you, we may suggest a smaller loan so that it facilitates an easier exit strategy. Essentially our Loan-to-Value guidelines are the guardrails for all parties involved.
Please note; we do not provide hard money loans on properties for cash-out to purchase, remodel, repair or improve a principal residence, a vacation home, or personal vehicle or boat — to purchase furniture, furnishings, appliances, or other consumer goods for personal use — to pay, refinance or consolidate personal or family debt or credit cards — for educational expenses, vacations, and medical expenses. These types of loans are consumer loans and do not qualify for our hard money loan programs.
WHO QUALIFIES FOR A RESIDENTIAL OWNER OCCUPIED HARD MONEY LOAN?
Here are the “owner occupied” scenarios that qualify for a residential hard money loan. When would an owner occupied loan qualify for a residential hard money loan? If you are living in the subject property, and need to refinance your current mortgage that was formerly written as a business purpose loan. We could re-write that loan as a “business purpose” loan as long as the cash-out will be used for business purposes. As noted in the above section, the funds must be used for business use and not for personal use.
Business purpose loans include: loans to purchase, repair or improve real property for use in the Borrower’s business — to acquire, improve or maintain certain non-owner occupied rental property, to purchase, improve or repair equipment, machinery, fixtures or furnishings used in Borrower’s business, for operating capital (e.g. employee salaries) or to purchase or pay for business inventory; supplies, rent, taxes, insurance, and other related expenses — or to pay off, refinance or consolidate business debt.
We will require documentation proving that funds will be used exclusively for business use.
If you currently live in the property and want to get a hard money loan – and you have a traditional mortgage – where the original intent was for consumer purposes, then this would fall under the consumer loan category and this loan would NOT qualify for a hard money loan.
WHAT ARE YOUR RESIDENTIAL HARD MONEY LOAN PARAMETERS?
- Loan Size: $50,000 to $20+ Million
- Terms: 1-3 Years
- Location: CALIFORNIA ONLY
- Property Condition: Turnkey or Distressed 1st & 2nd Trust Deeds
- Competitive Interest Rates (Contact us for rate/terms)
- Amortization: Fully Amortized and Interest Only Available
- Loan to Value: Up to 65%
- Pre-Payment Penalty: 0-6 mo. Influenced by LTV and Loan Amount
- Origination Fee: 1.5%-4% Taken at Closing From Loan Proceeds
- Closing Terms: Closings in as Quick as 7-14 days
HOW TO GET STARTED ?
1) Email joseph@hardmoneyloansca.net or call us at 818-952-2750 to go over your loan requirements. You can also text your scenario to Joseph at 818-209-7396. We will run comps to confirm value and make sure this is a loan that meets our Hard Money Loan Guidelines.
2) Next, we will send you a link to complete an online loan application HERE. Click on Apply Now and follow steps.
3) Once we receive a copy of your loan application we will review and determine within 24 hours if you qualify for one of our Hard Money Loan Programs.
4) If you qualify, we will send you our state regulated disclosures and request further documentation. If you have exterior/interior photos of the subject property, you can email those over. In most cases we can close your loan without an appraisal and use an in-house Broker’s Price Opinion.
Items typically requested are:
-Copy of Driver’s License
-Copy of Trust Certificate/LLC (if holding title in these)
-Copy of Hazard Insurance Policy
-Copy of Credit Report (we can run this if you do not have a copy)
5) Next, we will open title and escrow and review all received documentation.
6) Once all disclosures are signed and documents are reviewed, we will draft the final loan documents and email them to escrow. Escrow will review the loan documents and schedule a notary and signing at your location of choice.
7) After we review the signed loan documents, we will confirm that escrow/title have completed their conditions – such as; order insurance, etc.
8) Finally, after all conditions are cleared, we will set up your loan for funding. Loans are set up to record same day or next day depending on county guidelines.
If you think a Hard Money loan is a good fit for you, be sure to Email us at joseph@hardmoneyloansca.net or call 818-952-2750 to go over your loan requirements. You can also text your scenario to Joseph at 818-209-7396 at and we can determine if you qualify for one of our hard money loan programs. We can evaluate a property in just a few minutes and give quick answers to your Residential Hard Money Loan questions.