the Cost of Personal Loans

Hard money loan - used when traditional financing is not available to you becuase of credit history or questionable property.

The cost of hard money loans are outrageous, 5% of the loan amount usually. The thing about it is it could be a life saver. This is one way of getting financing for a home when you have no other options. I was a mortgage broker previously and I have several types of loans. I never thought I would be in a position of having to use hard money. Right now because of the market I would say 5% that was once outrageous to me is no very reasonable. There has never been a more perfect time because the prices that banks are willig to sell their properties for makes buying a wise choice. However with all the credit issues going traditional financing can be difficult or near impossible to get. With hard money you have a chance to own a home. Yes with hard money you have costly fees, and high insterest rates, but becuase you were able to get the house at such a reasonable price it is more than worth it. I would say going more than 5% of the loan amount is fair - any higher than that, you should probably keep shopping. There are so many lenders charging less than 5 points (5% of the loan) and offering programs that will suite any loans needs. Hard money are all over and have been around for a long time, people may not realize there are other ways to get money for a house without going to a traditional bank. You can search HARD MONEY LENDERS in nt search engine and will get several results for serveral types of situations.

There are always a few question you need to ask

1. HOW MUCH? The points on a loan can make or break a deal. You really don't want to use the private investor charging 10 points

2. Loan terms, chances are if you are going to hard money lender you have bad credit - make sure the loan term give you the time you need to fix your credit and refinance out of the loan at a later. If you have to wait 7 years for negative marks to fall off your credit, don't get a loan that you need to get out of in three years - or 1 year for that matter.

3. Minimum loan amounts, A lot of lenders will have minium loan amounts lke 100k, or 150k. If you can't afford a loan of 100 - 150k at 11.5% (or what ever high rate you are being charged) FIND ANOTHER LENDER. No use getting yourself into a foreclosure because you financed more than you can afford.

4. Save your money! Hard money loans will have a lot of fees - so the 5% of the loan amount isn't the only thing you have to worry about. You can easily shell out almost 8-10k on a 100,000 loan. Be safe and wise with your investment.