I have been battling with realtor(s) for the past four (4) years, for the rates, and strustures of loan in the
financing circle. Foreclosure's now coming in a big way, so is hard money coming every out. The same realtors
I have been dealing for the past four to five years have been facing a problem with the "hard money" interest
rates. For those realtors who have made "ka-ching" during the boom time, has been having a problem
considering the rates from the hard money.
They have to realize they can not sell this notes in the secondary market at all.
- It is not all ways a no-doc loan
- they look at the ltv, even though it is high interest loan
- they look at the property
- they look at the circumstances of the loan
But it is win-win situation for the principal, and the lender. Brokers and borrowers who are worried
about the negative connotations once associated with hard money lending can rest assured. Although some
dishonest hard money investors engaged in predatory practices in the 1980s and 90's heavy regualtions and
scrutiny have curtailed them. The Home Ownership and Equity Protection Act of 1994 (HOEPA) improved ,
consumer awareness of high cost, high rate loans with additional disclosures. Further, HOEPA set forth specific
parameters for owner occupied short term loans, including minimum-term, prepayment penalties.
Equally important is working with a credible hard money broker, and lender. Again not everyone can qualify for
hard money loan.
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