Posted by Ed Garcia on January 15, 2001 at 10:02:23:
In California, Hard Money lenders loan on Residential property at 65% of market value. If the loan is in second position, depending on the deal, they might lower that to 55%.
The thinking is, if they should have to foreclose, they will have to debt service the first mortgage. Therefore they want more room in the deal to cover the loss of payments being made to the first.
As you can see, your deal is at approximately 77% so it couldn’t go hard money. Some lenders will go up to 80% on a second money purchase if you have good credit. I think we both know that if the deal is seasoned and you have good credit, there are lenders that will do 100% financing.