Starting with hard money loans

[Ken Smith]

Has anyone started there real estate business with hard money loans? I’m new to real estate and looking to transition into it full time. I’ve been doing a lot of research. Just want to know the pros and cons

[Wendy Sweet]

There are several reasons why you should utilize a hard money loan. 

The reasons one should consider hard money, in my opinion, are as follows:

The property to be purchased might be presently vacant and in need of repairs. It may be an older property in a failing neighborhood which has the potential for revitalization. It may be a foreclosure and can be purchased on a short sale.

You may just need a quick closing to secure a property before you find an investor/rehabber to which you want to wholesale the property.

You may want to purchase a run down piece of property, rehab the property, and refinance it for rental income.

In all these cases, you would need a hard money loan because conventional financing is not an option or it would take too long to secure.

Hard Money/Private Capital is just a cost of doing business and is an effective method of doing business as a real estate investor.

I hope that helps.