Hard Money Loans
Hard money loans are needed when a borrower and/or a property fall outside of the underwriting guidelines of conventional sources such as banks, life insurance companies and conduits.  The primary credit decision of those types of lenders is based upon the borrower’s credit and income.  A loan may be a very prudent transaction from a risk perspective, but it cannot be documented or classified under “A” paper or Subprime guidelines.  Hard money provides creative and fast access to both private and institutional funds when conventional financing sources may be inappropriate or undesirable.

Hard money loans are those loans usually funded at a higher cost to the borrower in exchange for the ease and speed of obtaining funding.

Hard money loans are almost always based solely on the equity (or loan-to-value ratio) of the property.  Usually this means a loan where the lender can approve the loan request based upon the value of the assets and side stepping much of the usual time consuming documentation and verification that a conventional lender might require to lend the same amount of money.

A hard money loan is based upon Appraised Value equity in the asset without significant regard to:

The borrower's income
The borrower's employment
The borrower's credit
The borrower's tax returns
The borrower's assets

The hard money lender will tend to overlook many items that are critical to a traditional lender and soft money loan.  These overlooked details will include:

Foreclosures
Bankruptcies
Judgments
Credit problems
No credit record or citizenship
Unreported income
Unknown sources of down payment
The number of outstanding mortgages

Hard money loans are quick and usually short-term loans.  The product fulfills a need for many seeking financing with a profile traditional, conforming lenders cannot service.

Contact your Freedom Financial mortgage professional today to discuss your specific loan situation.

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