Palm Beach Real Estate and Loans

A Client of mine brought up the subject of Hard Money loans.  He practically cringed when he said the words -

He, like so many other people, just didn't know what they are.  You really don't hear about them too much, but they fill an important niche in the mortgage world.  Hard Money is available for both residential and commercial deals.

I'm going to give you the basics of this type of loan today -it could be the solution you're looking for in financing your Palm Beach real estate.

In a nutshell, we're talking about private money that is NOT backed by the Government as opposed to the typical conventional mortgage product.

So knowing that, why would you use it?

• Since you're looking at a private money source, qualifying requirements are much less strict than with conventional mortgages.  
• If credit scores are even considered, they can be lower then the typical range. This is probably the biggest positive factor.
• Due to the lower requirements, the whole process is usually much faster.

So if there is a credit history / score problem, a very unique situation or time is very short, hard money might be the way to go.

On the other hand you have to look at the terms of the loan.

• The maximum loan-to-value (LTV) is typically low, around 75%.
• Rates are typically very high - I know of one company that will charge between 9.99 and 13.99%.
• The up front charge for the loan will also be higher then what most people would expect, ex 5+ points

While the costs may seem extreme (especially the rate) these are typically only used for short periods of time.

If you can qualify for another type of financing, that is certainly a better way to go.

BUT if you need the money and conventional won't work, there ARE alternatives.

Please call me at (561)-282-7406 if you have any questions about this or any other kind of financing.