Most Common Types of Hard Money Loans Available Today

Hard money loans

• come from individuals and not typically from traditional lending institutions

• are great for beginning investors who may not have the total amount needed to purchase their property

Most common types of hard money loans

1. Rehab or Renovation Loan

• allows the buyer to purchase the real estate property and to also

make the necessary renovations it may need

• allows the buyer to get a loan for more than the current value.

2. Bridge Loan

• a short-term loan that is used until the investor/buyer is able to get

more permanent financing.

• offers immediate cash flow

• are also backed by some form of collateral such as real estate

3. Spec Construction Loan

• short for speculation

• contractors, builders and developers will build homes without the

guarantee of sale and are said to be building on “spec”.

• Spec homes are constructed and purchased on a speculation basis.

Things to remember:

1. Make sure that you have some sort of down payment available

Things to remember:

2. understand the terms and conditions of the loan itself

Things to remember:

3. make sure that your budget reflects the true costs of buying the property and all renovation costs, including contingency money

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