Everything You Need to Know About Getting Started With Hard Money Loans

January 10, 2023

While hard money loans can be used for people will bad, little, or no credit, hard money lenders in Houston can also help investors who want to fix-and-flip a property and need a short-term loan without having to go through the lengthy underwriting process. Instead of going through a traditional bank that relies on credit scores and history, hard money lenders use private lenders and base the loan primarily off collateral assets, most often the value of a property.


Hard money loans offer a quick turnaround, flexibility, and more options to choose from than traditional bank loans. The following are some benefits and features of securing a hard money loan, as well as some things to consider before going this route.


To make the loan worthwhile for the private lender, the terms on hard money loans are shorter than bank loans. Most hard money loans will mature within one to three years, a feature that attracts house flippers. Interest rates for hard money loans range between 8-16 percent for loan amounts starting at around $50,000 and going up to $1 million or much more.


The most attractive feature for many hard money loan recipients is the ability to access the funds much faster than a conventional loan process. As long as the collateral information can be easily verified, approval for hard money loans can be completed within the same day, with the funds becoming available within days.


Most private money lenders will limit loan amounts to around 70 percent of the property’s after repair value to create a bit of a buffer to pay for potential added costs in worst-case scenarios. If the loan defaults, the home will need to be foreclosed and sold to create funds to repay the loan.


It sounds simple. You put up your house or other significant assets as collateral to secure a short-term, high-interest loan. However, these loans are more expensive and can cause negative financial consequences if the loan defaults. You could lose your home and loan money. The important thing is to have all the facts and deal with reputable, trusted hard money lenders.


The loan specialists at Tidal Loans are dedicated to providing investors of all kinds with a fast, simple process to obtain a private money loan. An impressive team of industry professionals has been helping people like you secure short-term, asset-based loans for the purpose of purchasing and making repairs on fix-and-flip properties.

Our staff combines over a half-century of real-world experience approving and managing hard money loans. We take great pride in helping investors achieve the American dream of homeownership.


If you are in the position to consider a hard money loan for a financially viable property purchase, contact hard money lenders in Houston at Tidal Loan for complete information and get started today.

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