Hard Money Loans and fees

[Evan O'Brien]

With hard money loans, what are the typical interest rates that are associated with hard money loans? And what are expected fees that are associated with Hard Money Loans?

[Andrew Postell]

@Evan O'Brien Hard Money Loans (HML) can run the gambit on fees and loan structure as well. So while fees and rates are important, they aren't as important as the terms and conditions of the loans. So rates can be anywhere from 7%-14%, fees can be anywhere from 2%-4%. But if a HML can only give me 60% of the ARV on a single family property...I don't care what their rate and fees are - I can't use that type of a lender. I mean, you can use whomever you want but that could cause me multiple different types of problems depending on my exit strategy.

Sometimes you don't know if a lender is any good until you are 1/2 way through the process and then it might be too late!  As always, lean on other local real estate investors in your area about who good HMLs are.  Another investor, that has already done the hard work on vetting lenders (and other vendors for that matter) will significantly reduce your pain in this area.  Lean on other people and that will help.  Hope all of that makes sense.