| There are various types of hard money land loans. | | | | raw land loans place them with private money |
| They are classified based on the purpose of the loan. | | | | sources. They will make loan decisions based on |
| Some of these are commercial, construction, bridge, | | | | asset value rather than the borrowers? credentials. |
| land acquisition, development and residential. The | | | | This makes these loans easier to get but harder to |
| term hard money refers to the difficulty in acquiring | | | | service. |
| such a loan. | | | | Since raw land deals are often time sensitive, the |
| Land is necessary for any construction or real estate | | | | hard money land loan lenders, are used to making |
| development. Most conventional lenders such as | | | | fast underwriting decisions. They quickly qualify the |
| banks, savings and loan association and pension funds | | | | borrowers and ensure that, they have the capital |
| are not interested in giving such loans. Developers | | | | required and then provide their decisions within one |
| therefore approach loans specialists who are able to | | | | or two business days. |
| find investors to make these difficult loans. | | | | Borrowers approaching hard money land loan lenders |
| Hard money land loan lenders are, one such group of | | | | are required to follow strict guidelines set by the |
| specialists who can find money for, short-term land | | | | lenders. Some lenders will not finance a purchase of, |
| development loans. They usually offer loans for a | | | | foreclosed properties or properties encumbered by |
| smaller percentage, of value than conventional | | | | liens or judgments. Borrowers typically use brokers, |
| lenders. Additionally, their loan terms are usually | | | | to navigate through the list of restrictions in order to |
| worse than conventional lenders. | | | | find, the best hard money land loan lender. Hard |
| Typically hard money land loan lenders will only loan | | | | money land loan lenders are frequently used, when |
| liquidation values of the land parcel. These lending | | | | the risk is higher, but there is adequate collateral to |
| sources have higher interest rates and shorter loan | | | | cover these higher risks. |
| terms. Most hard money land loan lenders who make | | | | |