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Hard money loans are also different from so-called soft money loans: Hard money loans are usually secured by physical assets like property and their assessed value in the form of equity.
The loan amount the hard money lender is able to lend is determined by the ratio of loan amount divided by the value of the property. This is known as the loan to value (LTV). Many hard money lenders will only lend up to 65% of the current value of the property. [3] There is no such thing as 100% LTV for this type of transactions.
This contrasts with a hard loan, which has to be paid back in an agreed hard currency, usually of a country with a stable, robust economy. [ 2 ] An example of a soft loan is a $2 billion loan by China's Export-Import Bank to Angola in October 2004 to help build infrastructure.
Key takeaways. Lenders have minimum requirements for business loans, including revenue, credit history and time in business. The type of business loan you apply for will impact how hard it is to get
Commercial hard money is a term describing a commercial loan that is generally non bankable. The company usually does not meet the standard banking criteria, but has real estate and or assets that are sufficient to collateralize the loan to the investors/lenders.
The hard money lender approves a loan in the amount of $170,000 — well within the typical loan limit of 70% of after-repair value. The loan term is 12 months, and the lender charges a 15% fixed ...
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