Hard money loans, what are the pros and cons?

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I want to get started in real state in California. I heard the term hard money loan and I'm interested in looking into it. if any body could tell me much of what they know about it (rates,requirements, techniques, loopholes...etc.) that'll be appreciated for life. thanks!

Hard money loans, what are the pros and cons?

The pros of a hard money loan are simple if you can't get the money any other way it beats out all of the conventional loan programs that turned you down.

Cons are the rate are higher, loan fees are generally higher, they are usually Adjustable Rate Loans (ARMS), there may be pre-payment penalties.

I know they sound bad but honestly if a hard money loan gets you to the end result you want and you can afford the risks they can be the correct way to go. Any choice when picking a loan should be based on the "dollars and cents" math. Emotion plays but it should not automatically out-way the math.

Private money is another option. For the right return and balanced risk you can advertise for investors. Make sure befor you work with any lender you look at the terms in writing. not all ahrd/private money investors are in the mob.

Good luck.

Before committing to a hard money loan make sure to exhaust all of your loan options. Look for bond/grant programs, USDA Loan programs, and FHA loans. Find out if there a economic redevelopment loans in your area.

Hard money loans, what are the pros and cons?

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Hard money loans, what are the pros and cons?

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