​Why should you keep your LTVs as low as possible when working with a hard money lender?

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Here's a tip for working with hard money lenders... 

Keep your LTVs as low as possible. Why? You ask.... 

One reason, is that it will help you get a hard money loan, and is usually going to be a better buy or investment for you too. 

Many investors seek hard money loans above the LTV the lender is offering. Maybe the investor is wanting to wrap the closing costs, loan costs, or other fees into the loan or maybe the subject property purchase price and rehab costs may exceed the lender's LTV parameters.

Don't try to "fit" the numbers into the LTV parameters. This occurs when the borrower won't increase the scope of work because doing so will put the borrower over the LTV limit with the lender and the borrower is trying to maintain the lowest LTV possible in order to avoid brining any money to closing. This will not work because the lender will eventually determine the scope of work is inadequate for the loan situation.

Do you have hard money loan tips or questions?