Hard Money Lenders Phoenix Arizona

Private Hard Money Loans in Phoenix, Arizona

We offer private hard money loans in the state of Arizona. These loans are typically funded fast (24-48 hrs) and we have a variety of loan programs that you can apply for. Talk to one of our loan officers today to see how we can help.

What are Hard Money Loans?

Hard money loans are also known as private money loans. These are short-term loans secured by placing real estate as the collateral. They are funded by private investors or companies and sourced by Capital Market Funds LLC of Phoenix, AZ. The amount of the loan depends upon the value of the property in consideration. This property may already be owned or be the one the borrower hopes to acquire. The hard money lender’s primary consideration is the property’s value. The borrower’s credit helps the process but is not the main concern. All you need is sufficient equity to place as collateral.

hard money loans Phoenix

Offering private hard money loans in Arizona.

Period

The term of the loan is generally short, from 1 – 5 years. It is payable by 2 options – interest only and interest cum some principal with a balloon payment at the end of the term. The interest rates and points charged vary from lender to lender and region to region. As these money lenders take greater risk with their money they charge higher interests (10 – 15%) depending upon the perceived risk. The points may range from 2-4% of the amount loaned. The Loan To Value ratio also factors in to decide the interest rates and points. LTV ratio is the amount of loan divided by the value of the property.

Most lenders advance up to 65-75% of the property value after the borrower has fixed the property. This is known as the After-Repair Value (ARV). Other lenders may cover the rehabilitation cost of the property too. This creates a risk and leads to an even higher interest rate (15-18%) and points (5 – 6) with little or no down payment. If the borrower can generate profit for themselves then they will use these terms for ready money.

Types

You can borrow money for single family residential, multi-family residential, industrial, commercial properties and land. Some lenders may lend only for certain types of property because they have market knowledge and experience for this type and not the others.

Many lenders do not lend on owner- occupied residential complexes. This is due to the rules and regulations they may have to deal with. All lenders deal in 1st position loans while few in 2nd position – as these increase the lender risk.

If you are going for a primary residence purchase; have a good credit history and a steady income history. When there is no foreclosure or short sale then it is best to borrow from a bank. Here at Capital Market Funds, we source the following types of private hard money loans in Arizona:

  • Lot Loans
  • Auction Property
  • Bridge loans

Generally, these hard money loans we lend out are for people with the following:

  • Cases where the buyer has credit problems, foreclosures, bad income history, etc. All they need is sufficient equity invested in the property.
  • Cases where quick action is required and cannot wait for the bank’s lengthy process.
  • Cases that need money quickly – within a week. The application is processed in a day or two.
  • Cases where the real estate investors are competing bids. Hard money loans get the sellers attention.

How to Qualify

  • The amount of equity invested in the property to be used as collateral decides the loan amount.
  • Capital to pay the loan is a crucial factor.

The plan for the property and how the borrower intends to pay off the loan are considered. If they intend to improve the property or use it obtain a long-term finance.