For New Jersey and Philly developers, investors, and flippers, there are so many opportunities out there that could provide a great way to make money that it’s impossible to list them in one place. Finding that perfect property is the first step, but afterwards you’ll need to find the financing to make it yours.
For many, a traditional loan might not work. You may need a loan for a property you just found but can’t wait for the paperwork to go through, or you could be in a situation where you currently can’t secure a traditional loan but can still pay back an additional one. No matter the specific situation, a hard money loan may hold the answers you need.
But the first step is just making sure that you are actually eligible for a hard money loan. Because they’re offered by private lenders, these loans have much more variable and much less restrictive eligibility requirements. Here are the basics.
Personal:
First, you personally must meet some basic eligibility requirements. For example, you’ll need to be:
- A US resident or foreign national
- A corporation
- A LLC or Partnership
Hard money loans aren’t designed for individuals trying to buy a personal home – these are business related loans for developers or investors. As such, those looking to them for a home purchase need to look elsewhere.
Property:
There are also some requirements for properties being purchased or developed with a hard money loan. Since the loan is actually secured with the property, it needs to meet certain basic requirements including:
- Be a commercial property
- Be a single family residence
- Must not be a manufactured home or condo
- Can’t be vacant land
- Property value must be high enough to warrant the loan amount in question
Your loan professional will help review the basics above to find out more about whether or not you are qualified for a hard money loan. If so, it could help you take the next steps towards your success.