interest rate of hard money loans?
The interest rate totally depends upon the Lender. The rate will range from 10% interest to 18% interest only annual interest rate payable on monthly basis in most cases. Some Lenders will differ interest payments to payoff, benefiting investors that do not want payments during rehab.
A loan against property or hard money loan refers to the amount you can borrow against your property. Banks provide loan against both commercial and residential property. Also, you can take a loan against your rented residential property, self-occupied property or vacant property. It could be a piece of land or a house. The amount received as loan against property can be used for acquiring new property or you can use the same amount to take over your existing loan by refinancing. It is a kind of secured loan where the borrower can use his/her property as collateral.
The eligibility criteria for loan against property may vary from bank to bank. Listed below are the common eligibility conditions that a borrower needs to fulfil in order to get a loan against property:
• Any salaried professional who is a permanent employee of an organization can apply for loan against property.
• Professionals like architects, chartered accountants, cost accountants, company secretary, doctors, engineers, dentists and management consultants can also apply for it.
• Self-employed individuals who are income tax payers are also eligible for loan against property.
• Banks will consider your total monthly income, how much savings and debt obligations you have before it approves your loan.
• The eligibility for loan against property is also calculated based on value of your mortgaged property.
• You should also have a good Credit Score.
However, this involves a lot of time and documentation. The interest varies from one bank to another and could be between 9% and 12%. If you want funds urgently, you will have to apply for a Personal Loan.
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