I work with many different types of real estate investors. From developers to rehabbers to long term buy and hold investors. Today I want to look at a very attractive long term hard money loan option that rivals bank terms. These long term fixed hard money loans for investment properties are a new and exciting product that deserves a look by any long term investor currently holding rental property encumbered with a hard money loan.
Historically, hard money rates have ranged in the 8-12% range, give or take. Recently, however, semi-institutional money has been flowing into the hard money space. This semi-institutional money has made rates for specific hard money loan products very attractive. The specific products I'm looking at today are the long term rental products.
There are two basic long term rental products I want to discuss. The first is the more traditionally structured 30 year amortized loan. This is a single loan, secured by a single property. Max loan to value is 75%, and the credit requirement is a minimum 650 credit score (although exceptions are available). Pricing is dependent on credit to some extent, but rates are quite attractive, although not quite bank rates. Qualification for thse long term rental loans, however, is very basic, and the paperwork required is minimal. Loan application, credit score, rental agreement, purchase contract if it's a purchase is the nuts and bolts of the paperwork needed. For purchases, the cash brought into the transaction needs to be sourced - but not seasoned. For refinance transactions, cash out up to 75% of current value with no seasoning requirements is available.
The second long term rental product I want to discuss is a 30 year amortized blanket loan. This product has similar requirements as the above-mentioned product - but the rates offered can compete with bank rates. The main requirement difference between this program and the previously discussed option is the blanket requirement. This product requires a minimum of 3 rental properties to be included in the loan. Loan to value is still 75%, and cash out is available.
For buy and hold investors carrying hard money loans, these two long term rental products are really exciting. The monthly savings and the security of a long term loan can really impact both the bottom line and your peace of mind knowing that you don't have a balloon payment to address in a year. For investors purchasing rental properties, its a great way to combine a high leverage point of 75% with the swift process of a hard money loan - while securing an attractive rate.
We specialize in private hard money loans in California for real estate investors. We can help with residential, commercial, even land and construction loans. Visit our site at acalending.com to learn more about our products, or feel free to call us with questions or scenarios directly at 877 462 3422. We are always happy to discuss the various options available today. Hard money loans are more flexible and affordable than ever, and offer swift, uncomplicated funding options for investors that may not fit within bank guidelines.