Private Money, also known as Hard Money, refers to loans that are made by individuals rather than banks. Because these loans are made by individuals, they aren’t looked at by a committee or a computer program that can’t think “outside the box”.
These loans can be made to people who won’t qualify for a bank loan. This can be due to credit problems, property problems or difficulty proving income by traditional means (tax returns, paystubs, etc.).
Since the security for the loan is the property, lenders can be more flexible in other areas. For example, we have done many loans for borrowers who have bad credit or no credit at all. We have also lent on properties the banks wouldn’t touch.
Loans are typically given up to 65% of the property value. For example, if a property is worth $100,000, the maximum loan available on that property would be $65,000.
NMLS #309743 California Bureau of Real Estate License #01232889