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Originative Financing For Apartment Investing – Hard Cash Banks

By Tim Tavender

When Fast Cash is Needed

There'll be instances during your real estate investing career when you'll need up front money swiftly on a short-term basis. Because of the brief time span, it's not viable to go the typical route which typically takes 30 to 40 days. That's why there are hard money banks available. Loans through a hard bank generally will be more expensive than other financing systems. The most vital aspect of employing a hard money lender is the fast accessibility of the money. Occasionally you may have the money in hand inside 72 hours of receiving the final docs from the title company.

The name “hard money” is because of the firm parameters that come into action when you enter into such a loan. Rates can run anywhere from 10% up to 18% which makes it an expensive option. The cost of the cash , however , can become secondary when you need cash fast to close a viable deal.

Minimal Red Tape

Maybe you have found a great property to renovate speedily to turn around for profit. You may need the loan fast because you already have a buyer set up for the house when it’s completed. The hard cash loan will be in place quicker than a typical loan and without all the red tape.

These hard money loans are usually written for a period of a quarter up to a year. The time is dependent on your requirements and the lender’s factors. Clearly the more you hold the loan, the more dear it becomes.

The LTV (loan to value) on a tough money loan could be lower than other loans. Often it runs 70% or lower. This may be based primarily on a professional rating of the property and calculation of the required repairs.

Remember you will need a title policy, insurance and an assessment which could amount to several hundred greenbacks. Most hard money loans will need origination points ranging from 2 points to 10 points. These closing costs must be paid up front.

Does Credit Rating Matter?

Don't make the gaffe of thinking you need to use a hard money loan to override your poor credit history. While there is acceptable collateral concerned, still and yet these banks need to know they are working with someone who has a track record of paying – and paying in good time. They're going to look for bankruptcies, repos, charge offs and collections. Whether there will be a credit history check in your case will depend upon the individual hard funds provider. Some financiers may be able to procure hard money loans without having their earnings or their credit certified. Again, it will depend upon the policies of the specific bank.

If you are borrowing for the express purpose of rehabbing a property, most of these lenders will offer what is known as a “draw request” form. This may be filled out to identify the repairs that have been completed – typically taken from copies of invoices from the contractors. The draws are broke up following a satisfactory inspection.

A Final Resort

When it comes to hard cash loans, they should always be used as a last resort – once you have tried other methods of raising needed capital. Never go after this sort of loan unless you are completely confident that you've a great bargain property on your hands. And you need to be sure of your exit technique.

In coping with singapore money lending make sure you are working with credible lenders. There are loan sharks out there who will purposely set you up to fail so they can take over your property. Double check references and ask for references.

The last tip, if your credit allows it, you may consider securing your investment property with a hard cash loan for a brief time and then refinancing it into a standard loan.

Which ever way you choose, know that creative financing is common for you to grab that bargain property you found. All you've got to do is keep on thinking out of the box.

Tim Tavender is a writer with ten years experience running his very own payday loan in singapore . He has written for Countrywide Newspapers and Magazines about personalloan .

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Article Citation
MLA Style Citation:
Tavender, Tim "Originative Financing For Apartment Investing – Hard Cash Banks." Originative Financing For Apartment Investing – Hard Cash Banks. 13 Apr. 2014. 2 Aug 2014 <>.

APA Style Citation:
Tavender, T (2014, April 13). Originative Financing For Apartment Investing – Hard Cash Banks. Retrieved August 2, 2014, from

Chicago Style Citation:
Tavender, Tim "Originative Financing For Apartment Investing – Hard Cash Banks"

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