Making progress with HML

Making progress with HML

Thanks to this board and Dean's books finding a HML is a little easier than I thought.

I've been going through CL and calling anyone who sounds okay.

Just today I found 2 that want a down payment (10%) and 1 who is from the same area who will do 100% plus rehab costs!!

I also found someone, by accident, who buys wholesale. He said he can help find me buyers to assign deals to.

I can't wait for my first deal. Now that I have some funding I will make a few offers!!



What are Hard Money Lenders and how do they work? We have a house paid through a credit line (essentially the banks are saying cash) and doing repairs with plans to rent it. But we can't find anyone to refinance it until we have had it for 6 months--which ties up that money for other deals.

Also we are bidding on 2 other houses and trying to figure out how to finance them.

Any thoughts out there?


HELLO julieproctor,

I MADE IT EASY I COPY AND PASTED THIS FROM From "Wikipedia, the free encyclopedia" WEBSITE
Hard money lenders are lending companies offering a specialized type of real-estate backed loan. Hard money lenders provide short-term loans (also called a bridge loan) that provide funding based on the value of real estate that has been collateralized for the loan. Hard money lenders typically have much higher interest rates than banks because they fund deals that do not conform to bank standards.

Hard money lenders will offer a range of requirements on the loan-to-value percentage, type of real estate and minimum loan size for a hard money loan.

Hard money loans are more expensive because they are not based upon traditional credit guidelines which protect investors and banks from high default rates. As hard money lenders may not require the income verification that typical lenders require, they experience higher default rates (and, thus, charge a higher rate of interest). Individuals and companies may opt to take a hard money loan when they cannot obtain typical mortgage financing because they do not have acceptable credit or other necessary documentation.

Hard money collateral is typically the real estate loaned on. However it can and does sometimes include other assets of the individual or business borrowing the hard money. In many cases a hard money lender will offer a smaller loan size based upon a lower "Loan To Value Ratio". This means they may opt to loan no more than 65% of the property value. Therefore it is common for real estate investors to offer additional real estate as collateral in order to obtain a larger loan amount. This is known as cross-collateralization.

HOPE THIS HELPS!!!!!!!!!!!

Do you think this would be a

Do you think this would be a source of lending I should look to for my situation? We have average income and very good credit. Do people use them for a 6-month period or just a couple of months?

Thanks for your help

I have also have same question

I tried to find HML who will lend against ARV, but none result yet, coach said there are some. So I should just keep looking for them. I also get stuck with the refi issue, my REO has six months seasoning already, just because our income on the tax return is not high enough to get regular refi. Someone who find HML who can lend against ARV, or 100% purchase price (assume which is about 50%-70% of the FMV), please PLEASE share some info, thank you so much. Also appreciate any tips on the refi part.

getting approved for h m loans


Google it!!

Google "hard money lenders" and you'll get a few. I've found some that will go six months or more. Be ready to pay for it though. Most are around 12%. However, I think I did see one that would defer payments for six months. Winny I saw some that will do 65% of ARV. Craigslist is another good place to look. Just look around. They're out there.

Bitter HML

Contacted a HML from a REI Club here in Illinois. Gave him the scenario of buying SFR HUD home at $73500 w/ $10-12000 in rehab and ARV of $130000. Mentioned that I had aggressive marketing plans when it's closed on. He says he's never seen a rehab that costs $12000. Then raises his voice, spits out some type of percentages , lending costs, insurance, and other mumbo-jumbo and proclaims that I'm not gonna make any money on it. I said, "so your saying that your costs to lend me are $40000? He gets frustrated , so I told him to have a nice day and ended the call.
Spoke to my mother (retired in Fla.with nothing to do) about it. She mentions she has a HELOC for $100000. So is sending me a check next week for a cash purchase on this house which i'm closing on in 2 weeks.
Thanks to Mom,my HML, which i will give her a $10000 bonus when house is sold. She was rehabbing houses when she was 70 yrs old.

T.S. Eliot said "Only those willing to go too far, can find out how far they can go"

What about insurance?

When you buy a foreclosure using a HML, do you need to get your own insurance before the bank will sell it to you? Or before the HML will approve the funds? And will any insurance company insure you on a rehab?


Usually homeowners insurance is part of the closing docs.

I'm curious to know what they do if you need to upgrade electical, plumbing etc.

The REOs that I'm looking at need heating. Most have had the copper stolen.

Maybe a HML will not require it.

Hey, Boston, I'm in Providence. Do you know any HML in MA?