Hard Money Fees - Posted by Todd H.
Posted by Todd H. on January 27, 2002 at 10:19:07:
I am not very concerned over the rate that a hard money lender charges becasue my exit strategy is one that has me out in 6 months but the 7-12% in points in a BIG sticking factor for me. I have an excellent job, very good income, a great credit score but I do not understand the reason for the high points? Is that so the lender makes his money upfront? Is that only for those with bad credit? I thought that hard money lenders loaned money on the property value, not the buyer? Those that do require personal lending critera then are not really hard money lenders are they?
Can someone explain to me how you structure a deal where you have a buyer who will let you have the property at 65% of it’s ARV yet I will still have to pay 7% points to get the deal funded (7% of $65k = $4550)? I am using the numbers provided by Rehab Funding…(7-11% in points and you CAN NOT finance them into the deal). This does not appear to be a hard money lender to me becasue it is also based on my personal credit. Is this true?
Can someone tell me if I am missing something here and if anyone has any other hard money lenders they work with that will allow you to finance the points into a deal. I am located in NC and have sevarl properties that I ma working on so any help would be appreciated.