Current Hard Money Lending Rates? (Jan 2020)

[Nigel Prentice]

Hello,

I've done a few deals as a private investor, lending money out to buddies who are doing fix and flips and buy and holds. My money is lent to them to acquire the property and for construction costs. Things have gone very well so far, and I'm looking to scale this out.

What are the current terms people are seeing in the marketplace for hard money lending?

1. Interest Rate?
2. Upfront Points?

I'm doing deals in Houston, Texas, but any feedback is much appreciated.

Thanks a lot,

Nigel

[Don Scott]

@Nigel Prentice

I know people that pay less and I know a lot of people that pay more. I believe as you get more experienced you tend to pay less for your money. I heard a saying when I first started in real estate, “you can tell the experience of the investor by what they pay for their money.”

I paid higher rates, around 12&2, when I first started 8 years ago borrowing from HML's. Now, after averaging 50 deals a year between wholesaling, flips, and buy&holds over the last 2 years, the rates I pay have come down.

I have borrowed and payed back millions and lenders and I a lot of money together.