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Is A Hard Equity For You?

By: George Burns

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Is Private Equity Loan For You?

A Private Money (http://www.fivestarsmortgage.com/hardmoney/) is a specific type of assets-based loan financing through which a borrower receives funds secured by the value of a parcel of real estate.Florida Hard Money Cashout Loan are typically issued at much higher interest rates than conventional residential property loans and are almost never issued by a conventional lender or other deposit institution.Hardmoney is similar to a bridge loan, which usually has similar criteria for lending as well as cost to the borrowers. The primary difference is that a bridge loan often refers to a commercial property or investment property that may be in transition and does not yet qualify for traditional financing, whereas hard money often refers to not only an asset-based loan with a high interest rate, but possibly a distressed financial situation, such as arrears on the existing mortgage, or where bankruptcy and foreclosure proceedings are occurring.

Most Hard Equity Loan are made by private local investors. Usually, the fico scores are not a focal point to getting one of these loans. They are mostly based on the property’s value. Typically, the maximum loan to value ratio is 65–70%. That is, if the property is worth $100,000, the lender would advance $65,000–70,000 against it. This low LTV provides added security for the lender, in case the borrower does not pay and they have to foreclose on the property.

So now that you know exactly what a Private Equity Cash Out Mortgage is, do you think you need one?

Well, ask yourself these questions:

1. Do I need fast money?

Most conventional financing as well as FHA (http://www.fivestarsmortgage.com/fha/) could take as long as 60 days to get financing. Most hard money loans take no more than 5 business days to fund. (If the property is your primary residence than you must add 3 extra days for right of rescission)

Do you have a recent bankruptcy or othe rmajor derogatory credit?

For conventional as well as FHA, you have to have been discharged from your bankruptcy at least 3 years and out of foreclosure at least 2. With hard money loans, neither of these things are a deciding factor.

Do you have bad credit?

For a bank to even take a look at you these days you have to have at least a fair credit score. That means a 620 or higher. If your credit is anything below that, hard money might be the way to go. They are not credit based.

Can you not prove your income?

Are you self employed? Or perhaps you have several properties that your income can not support. Once again, hard money loans are based on the property itself so, income (although you might have to show that you do have a source of income) is not limited to a specific debt to income ratio like most loans.

A Private Money Cash Out Loan allows anyone from an investors to residential homeowners, to commercial owners, to have access to funds that they need quickly with little documentation and hassle.

Investor Loan Program

For investors that want to buy properties we have a program that allows up to 65%-70% LTV based on purchase price. There is no limit to number of properties owned and credit is 620 minimum. This is an excellent loan program for investors looking to pick up cheap foreclosed homes in today's market with little money out of their pocket.

For residential and commercial owners looking to cashout we can do 40%-50% of the value of hte property NO DOC. This loan can close in 3-5 days. If you have a free and clear property and want to get cash out of it but don't think you can because of credit or income problems... this is the program you have been waiting for. There is no restriction on MLS listings, bankruptcies, or title seasoning. This is true for owner occupied, 2nd homes, and investment properties alike. If you can document your income and have at least a 600 FICO we can go up to 65%-70% LTV with a lower interest rate. This is more of a "subprime" product then Florida Hard Money Cashout Loan, but in today's market it's all the same.

Article Source: http://depositarticles.com/

Five Stars Mortgage is a Florida based mortgage company providing residential and commercial financing. Visit them on the web at www.fivestarsmortgage.com

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