How To Pick The right Hard money/ Private Lender

[Rod Coleman]

Hello everyone this is a question that has perplexed me while looking for hard money lenders. there are so many in the market to day making it hard to choose from.

[Cameron Sharp]

Ask these questions of each. See below.
Make sure you know what you want, resources you have, and exit strategies planned out before hand.

- what are your points and interest?
- how long are your terms?
- do you lend on ARV or current value?
- what LTV do you lend? (Most are 65-70% ARV )
- do you cover rehab?
- does the LTV include points and interest?
- are there any upfront fees? Of yes, stay away in most cases outside of appraisal, docs fees, etc. Lenders who charge to consider your deal or charge an upfront fee usually make their money from charging you. If they say you have to "buy" their program, be cautious. Some will charge am application fee, don't pay more than $100 one time.
- what are your penalty fees if the loan goes past term?
- ask for references. Some will provide to protect their client, but some will share. Doesn't hurt to ask.
- are there any hidden fees?
- how much money do I need to put in the deal as down payment or skin in the game?
- how do you disburse the rehab funds?
- how fast can you close?
- how do you determine the ARV? Appraisal, BPO, comps, etc.

This should be a good start