Hard Money Loans
Utilizing Colorado Hard Money Loans, property owners seeking mortgages for Colorado real estate are able to leverage the value of existing real estate holdings to obtain capital for the new real estate purchase. Lenders using Hard Money Loans often minimize the value of the collateral property that is used to secure the loan to 60 to 70% of its value to minimize their risk.
Do I Need a Colorado Hard Money Loan?
Hard Money Loan refers to an asset-based loan with a high interest rate and a Bridge Loan is normally used for a commercial or investment property in transition. Hard money loans are typically issued by private investors or companies for projects lasting 3 to 36 months.
Hard money loans may be used in distressed situations. Hard money loans help property owners to avoid imminent foreclosure or a quick sale. A borrower may save equity and extend the time frame needed to balance his books. Borrowers look into hard money options during distressed financial situations, delinquency on existing mortgages, or midst bankruptcy and foreclosure proceedings.
Hard Money Mortgages are more expensive than Sub-Prime Mortgages. The rate depends on the real estate market and the availability of hard money credit. Extra points also make hard money loans more expensive for the borrower. In comparison to a traditional loan, hard money lenders charge 1 to 3 points more. Commercial hard money loans may cost much more in points. The rate and fees may vary from lender to lender.
Qualifications and criteria for Hard money loans vary depending on the purpose of the loan as well as the lender. Most lenders base decisions on the value of the real estate being secured as collateral and may consider credit scores and income.
The Hard money loan field is loosely regulated by state and federal laws. It is important that borrowers consult with professional real estate attorneys regarding hard money loans before entering into contract.
For information about creative solutions for rural loans used to develop housing, businesses, industries, and cooperatives. Please contact Taylor Mortgage Group at (303) 339-5950 or Janie Taylor directly at (303) 884-9393.
