Private Mortgage Lenders and Hard Money

Where and how does a person search out and apply for private mortgage financing? Any suggestions on what to look for?

4 Answers

The world of private or "hard" money is a complete sub-culture unto itself. It is a completely different ball game than conventional lending.

To answer your question, private mortgage money is significantly more difficult to find than conventional lending. In most advertising mediums, private money lenders are clumped together with conventional lenders which means it can take a long time and a lot of phone calls to find what you are looking for.

The good news is that you can still start your search with your favorite mortgage professional (if you have one). If you don't, use whatever method you prefer for obtaining the name and number of a good mortgage broker or loan officer. Chances are they have connections that can lead you to a private money lender.

Our office is a conventional lending office, yet we have 2 associates dedicated 100% to brokering private money transactions.

Start there. If you don't find a relationship that inspires you, try a simple web search for you area (example: "portland, OR Private Money Mortgage").

Beware of a couple things. Just because a company comes up on the search doesn't mean they're the best. Often times they have just paid an ad agency to make sure their company comes up on google when people are searching specific key words. Sad but true.

Also, there are hard money lenders and hard money brokers, each with an upside and downside. If you go straight to the person or company with the money, you will likely pay less for your loan, but your chances of success are smaller and the amount of knowledge you have to have going in is higher.

If you go to a hard money broker, the loan will be a piece of cake, but you will end up paying the broker as well (this isn't necessarily a bad thing if the broker finds you a much better deal than you could have found on your own).

Final thought: Hard money is expensive compared to conventional lending. Most hard money lenders charge around 4 points (meaning 4% of the loan amount--often can be rolled into the loan) and around 14 % interest. You'll have to have an exit strategy because most of them won't hold the loan for more than a year. If you need more information on Hard Money in the pacific northwest, feel free to contact me as our office has the hard money division.

Private Mortgage financing today is very difficult to obtain, many companies who once offered this type of financing are no longer around.

Before anyone in my opinion could offer you suggestions on where to look they would first need to know why you are seeking this financing option and if you are looking for purchase or refinance money and will this be used for a primary residential, investment or commercial property type?

There are choices available in the private sector for financing, my advice would be start with a qualified mortgage consultant who has experience in this type of financing and share with them your financial picture and why you are looking for this type of loan.

Great question.

Dont forget: Americash is known as one of the Nations top originators of residential mortgages. Americash pursues cost effective advertising, primarily through the internet, and passes the savings through to the consumer in the form of lower rates.

Would certainly beware of a company who throws random anonymous answers in on a mortgage site when real, identified loan officers are spending their time, and volunteering their expertise to help with inquiries!