Trying to lean into hard money this time...big questions

[Karen Cook]

We have been investing for a long time and have always used traditional banking.  This time, we had a 3 month flip, and thought we would use a hard money lender, but when I saw the rates and fees, I was astounded.  I knew it would be high interest, but they are not only charging 13.9% but an additional 4 points. We wanted to stay with a local lender (Jet) but we are thinking we should ask a few others to compare.  Any thoughts?  Maybe this is normal? Any others with experience with hard money (and hard rates?)

Thanks for welcoming us aboard!

Dwight and Karen

[Christopher Telles]

Originally posted by @Karen Cook:

We have been investing for a long time and have always used traditional banking.  This time, we had a 3 month flip, and thought we would use a hard money lender, but when I saw the rates and fees, I was astounded.  I knew it would be high interest, but they are not only charging 13.9% but an additional 4 points. We wanted to stay with a local lender (Jet) but we are thinking we should ask a few others to compare.  Any thoughts?  Maybe this is normal? Any others with experience with hard money (and hard rates?)

Thanks for welcoming us aboard!

Dwight and Karen

There's no doubt that hard money rates and points are stratospheric especially if you're accustomed to borrowing on conventional terms from banks. I too have been looking at using hard money for some deals, and have talked to at least a dozen HMLs over the last sixty days. I don't have direct experience working with this HML but @Chase Maherhas made a compelling case in our conversations where I would seek him out early in any deal I was shopping for money. I don't know if they lend outside of So Cal but perhaps he'll chime in here and provide you some additional guidance when shopping for HML money.