Tip for Working with Hard Money Lenders- Understanding the Numbers

[Account Closed]

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

Understand all numbers are going to be estimates until all of the variables are completed and final numbers are calculated. The hard money lender might be able to give you an idea of the amount of money needed for closing but it’s only going to be an estimate. You should always expect to bring some money to closing.

Even though hard money loans don’t usually require a set down payment, it is almost unheard of where the investor borrower will get 100% financing with absolutely no money into the deal. Investor borrowers should always anticipate and expect to have some money into the deal.

Final numbers are determined once the appraisal is received, the scope of work figures (when applicable) are finished, and closing costs and fees are finalized. At this point a specific dollar figure can be given to the borrower. Until this point of the process all numbers are going to be estimates.

[Ben Stoodley]

Great tip @Account Closed ... as long as you are clear with your HML and they are clear with you, budget in all the fees and closing costs, make sure to be ready to come to the table with some skin in the game, and it will be a smooth transaction!