Communication is key to a successful real estate investment. Throughout your project, you need to be able to clearly manage timelines, expectations, financing, and more to create a streamlined and profitable project. When working with a hard money lender, step one in the process is a thorough back and forth ensuring that both parties understand the goals of the other.
Over our 15+ years of experience in real estate lending and investing, these are the questions we've heard most often along with the answers that we've provided. When you're ready to submit your loan application and get the ball rolling, we'll cover these topics in our first conversation, but just so you're ready, take a few minutes and review them here.
Questions Investors Should Ask Their Financing Partner
How much experience do you have in hard money lending?
The Hard Money Co. has been providing investment funds to real estate entrepreneurs for more than 15 years. Over this period, we've closed thousands of deals and have put hundreds of millions of dollars into the hands of our borrowers. There are very few deals that come across our desk that pose problems we haven't seen before. No matter how unique your investment might be, chances are someone on our team has worked through similar challenges in the past on the way to a successful investment.
We're also real estate professionals ourselves. Our growing team now exceeds 20 in-house employees who have experience in every facet of real estate including investment, brokerage, agency, conventional financing, construction, appraisal, and more. If you have a question about your investment at any step in the process, we'll be able to provide you with the insight you need to move forward.
Do you have referrals or references from previous borrowers?
Referrals, references, and repeat borrowers are how we build our business. The majority of our loans on a month-to-month basis are from investors who have successfully borrowed from us in the past and have returned to continue growing their business. We only succeed when our borrowers complete successful renovations. Our growth over the past 15 years is a testament to the investors who keep coming back for more.
And we can prove it.
We have a large number of borrower testimonials and google reviews that speak to our ability to provide fast, effective financing for real estate investing. We currently boast a 4.95 rating on Google reviews and hear back from satisfied borrowers on a daily basis. We recommend that you read what they have to say, and if you still aren't convinced, we can put you in touch with existing borrowers that will confirm everything we've said here so far.
What are your loan terms?
Our loan terms are outlined clearly in many places on our website and are 100% consistent for all of our borrowers. And we didn't arrive at these terms by accident. With our years of experience, we've found that these terms allow for the risk to be properly allocated in the investment, giving you the ability to maximize your profits while still ensuring you maintain skin in the game.
Here are those terms at a glance:
- Loans up to 65% of After Repair Value (ARV)
- Minimum of 10% down payment on the purchase price
- Or the collateralization of a free and clear asset
- 6-Month Term with no prepayment penalty
- 15% Annual Interest Rate
When hard money lenders aren't clear about their terms, it should be a red flag for the investor. Our goal is to be as transparent as possible, making sure that you have a complete picture of your investments finances as early as possible. Look at our Hard Money Loan Calculator, and see how these terms fit into your potential investment.
What LTV do you offer borrowers?
The Hard Money Co. is an asset-based lender. This means that our decision on whether or not to finance an investment property is entirely based on the merits of the deal. If the investment is sound and the borrower has skin in the game, we will provide the financing to close the deal. Our ultimate decision is based on the anticipated after repair value (ARV) of the property. We will finance up to 65% of this ARV while providing funds for 100% of repairs.
While 65% may seem as compared to traditional lending institutions, it's important to distinguish this ARV valuation from a conventional appraisal. We do not perform on-site appraisals for the properties we lend on. Instead, we complete internal CMAs to ascertain what the asset might be worth when all the work has been completed. So while our loan is limited to 65% of ARV, it may be a significantly larger LTV in actuality.
How long will it take to get my funds?
We can close your deal in as little as 7-10 days. But while we can do this when circumstances require it, we are more likely to close in 2-3 weeks. This is because many different parties are required to close on a real estate transaction. Lawyers, title companies, brokers, agents, buyers, and sellers, all need to come together to get these deals done. If anyone falls off schedule, it can delay the entire process.
The best thing you can do to ensure an expeditious closing is to make sure you have all of your ducks in a row. When we reach out to you or ask for documentation from you, do everything in your power to get us what we need. You don't want to be the reason your loan gets held up, and we promise that we will match your urgency as we head toward the finish line.
What type of properties do you lend on?
The Hard Money Co. lends on a variety of real estate asset types, but primarily finances deals with single and small multi-family properties. This is because our typical loan term doesn't allow for projects with a longer runway. While we're able to lend to new construction projects or commercial endeavors, the realities of those investments don't always fit smoothly into our program.
We are experts in residential fix and flips, BRRRR method, and renovation investments. We know that our expertise and financing, combined with your dedication and strategy, will result in successful projects. If you have a deal that fits that mold, fill out an application today and start your investment journey. If you have a real estate investment opportunity that breaks the mold, let us know about that too! We will do everything in our power to help you succeed, or point you in the direction of someone who can.
What Questions Will The Hard Money Co. Ask?
While you might have questions for us, we also have some answers that we need from you. Luckily, these are all captured in our online loan application. If you complete the application honestly and thoroughly, you are already well on your way to receiving financing for your investment.