hard money loans in Atlanta

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How much money do you currently have in savings? Enough to cover an unexpected emergency? If your answer is no, you aren’t alone.

Less than half of Americans would have the cash available to cover a $1,000 emergency. Meaning most turn to credit cards when money is tight. Besides credit cards, another option for quick money is hard money loans.

What exactly is a hard money loan? Keep reading to find out the answer to that question and detailed information on hard money lending rates.

The Basics of Hard Money Loans

Typical loans for things like cars and homes require proof of income so the lender can be sure you will pay them back. Most lenders also check your credit score for any negative marks such as late payments.

Hard money loan lenders do things differently. They typically secure the loan using personal collateral. If you don’t pay, they simply take whatever has been agreed upon.

Common things include cars, home equity, investments, or even insurance policies.

Detailed Look at the Costs and Hard Money Lending Rates

These type of loans are usually short-term and for good reason. You would not want to have a hard money loan for long due to the higher interest rates usually associated with them.

Currently, hard money loans are floating around 7-12% interest rates. Your exact rate will depend on your credit history, collateral assets, and how much you need to borrow.

In addition to interest rates, you must also consider what is called upfront points or lender fees. One point corresponds to 1% of the loan. This is how many lenders will simplify their closing costs and end up costing you much more.

Being charged 3 points (3%) on a $50,000 loan would equate to $1,500. This wouldn’t be like interest over the life of the loan but instead disbursed completely at the start of the loan.

Pros of Hard Money Loans

While it is true you will likely encounter higher interest rates, there are benefits to these types of loans. One huge factor is speed. Because the lender will not need as much verification and only collateral, you will receive your loan quickly.

Hard money loans are also very flexible. You will likely be offered a deal specific to you and your situation. They are also good for people who struggle with financing elsewhere due to poor credit.

Time to Decide if a Hard Money Loan is Right for You

There are many things to consider when looking for loans, especially hard money lending rates. Regardless of why you are in need of a loan, these types of loans have a lot to offer.

If you are ready to discuss your situation or have further questions about hard money loans, please contact us. We would love to hear from you!