Hard Money

[Carita Yeager]

I have only used hard money once, and that was under a special circumstance. I was told recently that if you exceed the deadline you get hit with a deluge of fees, making it impossible to pay off. I'm trying to find out what the truth is about that. If you know the facts or can direct me to reliable information, I'd really appreciate it.

[Ann Bellamy]

Carita, each lender will have his/her own terms.  There is no constant.  It is possible that whoever told you that either experienced it, or heard that from someone else.  Or exaggerated it.  

When speaking to a lender, be sure to ask what happens if you need an extension, and ask to have those terms built into the deal from the beginning instead of negotiated when your back is up against the wall.  Also ask about back end fees, and get those fees in writing.  If a lender hits you with paperwork at the closing table that includes unexpected fees that you didn't expect, I'd walk away.  All fees and points and percentages should be disclosed up front.