What is Residential Hard Money Lending?
The definition of “residential hard money” when referred to in real estate financing, is essentially a non-bankable loan on an investment single family home (or duplex). The name residential hard money is frequently interchanged with “no-doc”, private loans, bridge loans, etc… For a residential hard money loan, the underwriting decisions are based on the borrower’s hard assets. In this case the residential investment real estate would be used as collateral for the transaction. Residential Hard money closes quickly (in as few as 3 or 4 depending on the circumstances). Fairview Lending is the recognized residential hard money lender (NO-DOC / Private lender) with an A+ rating with the Better Business Bureau.
How is Residential Hard Money different from a bank loan?
The following table summarizes the key differences in loan characteristics between a conventional bank loan and a residential hard money loan from Fairview Commercial Lending.
|Bank||Fairview Commercial Lending|
|Basis for loan approval||Income, credit score, tax returns, financials, appraisals, etc…||Residential Real estate assets|
|Minimum FICO scores||Typically 700+||None|
|Required documentation||Significant||Minimal on the property|
|Upfront fees||Appraisals, application fees, etc…||None|
|Property Type||Owner occupied and investment properties||On residential loans can only lend on investment single family homes|
|Time to receive loan money||60 days +||Less than 10 days|
A residential hard money loan is a good alternative to traditional bank financing. This alternative financing is beneficial to the borrower in many circumstances. Below are just a few of the reasons when a residential hard money loan might be appropriate.
When is a Residential Hard Money loan appropriate?
- Borrowers with impaired credit (Fairview Lending can lend to borrowers with any credit including past bankruptcies)
- Tax Liens/Judgements/unpaid items etc..
- Borrowers that need funds quickly on their residential investment property
- Property repositioning (Nip the flip article)
- Time constrained borrowers/ Borrowers need a quick closing
- Borrowers in need of a stated loan due to tax returns (or lack thereof)
- Foreclosure avoidance
- Foreign Nationals
- Borrowers do not have the time or energy to jump through the multiple hoops of a conventional lender
- Complex loans with multiple pieces of collateral
- Fairview is able to handle many unique residential real estate financing needs with no upfront fees on investment single family homes [ for commercial hard money lending please see: Commercial Hard Money
See the following resources related to Hard Money Residential Lending
- Nip the flip: Get the real facts about residential fix and flip lending and hard money lenders as published in the Scotsman’s residential mortgage magazine
- Key tips prior to utilizing a residential hard money lender
- Use Caution when selecting residential hard money lenders as published in the Colorado Real Estate Journal
- Residential hard money: get the facts on utilizing a hard money lender
- What is Private Lending
- Residential hard money lending parameters
- One page residential hard money loan application (no upfront fees)
- Atlanta GA residential hard money lenders
- Georgia residential hard money loans
- Denver residential hard money lenders
- Colorado residential hard money loan
- How are Residential Hard Money loans underwritten?
- What is Fairview Lending’s loan process?