In the context of our website we are grouping together “Hard Money Lenders” & “Private Lenders” into one section.
Private Lenders are often just other investors willing to lend money on other people’s real estate ventures for a percent return on their money by charging points and interest. Many investors that do their own real estate projects lend on the side.
Hard Money Lenders are companies and individuals that typically lend in ways and on deals that banks cannot. They are more concerned with the collatoral on the deal (the house) then with your income or credit scores.
What is the difference between “Private Lenders” and “Hard Money Lenders” you ask? Typically Private Lenders are more relationship based and typically are not only in business to provide loans. Hard Money lenders are primarily making their money by creating loans, Private Lenders often lend on the side.
APR = Annual Percentage Points
LTV = Loan To Value, the ratio of a loan to the value of an asset purchased.
Points = Fees based on % of loan paid directly to the lender at closing in exchange for a reduced interest rate.
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