Newbie-Hard Money Question
I found a house that is for sale by owner, It is appraised at $435k, and they are selling it at $299,900.
I also found a hard money lender whose claim is: "True no doc loan for investors without a job and just starting out! Purchase 95% LTV, cash out refi 90%!!!
Now my questions are, what does all this mean:
Category: Owner occupied (Does this mean I have to occupy it, or that it is currently occupied?)
Prog Type: 30 year fixed (Could I pay this off sooner?)
Rate: 6.500 (Is this the interest rate?)
Discount points: 1-2 (What does this mean?)
Fees: 600 (What does this mean?)
Lock: 30 (What does this mean?)
Min. Credit Score: 620 (Mine is 772, so no problem there)
Min. D/E: 0 (What does this mean?)
Min. LTV: 95 (Loan to Value?)
Cash out refi: 90 (What does this mean?)
Documentation: No Doc (Does this mean I have to have no documentation on the property or what?)
And generally how long does it take to get a hard money loan?
All in all, do you think that this would be a good deal?
Thanks for any info that you can provide
Sincerely, Steven K. Long [ Edited by SKL on Date 01/29/2004 ]
I am not a lender but am familiar with the process so to answer your questions if you haven't already found out:
Owner occupied means if you are getting the loan you have to occupy the house as your primary residence.
More than likely you can pay the loan off whenever you want, however, sometimes there is a prepayment penalty for the first year or two, but it depends on the lender.
The rate would be the interest rate.
Discount points is what you would be charged for the loan--1% to 2% of the loan amount which is usually paid from the loan amount.
Lock:30 probably means you can lock your interest rate for 30 days. So as long as you close before 30 days you can get the 6.5%.
With a FICO of 772 you can probably find a better loan than this.
D/E: ?
LTV: Loan to Value
Cash out refi: if you currently own the house you can pull out up to 90% of the value of the house in the form of cash.
Documentation: no doc means you do not have to provide W-2s, tax returns, bank statements, etc.
From what I understand hard money loans can close within 7-14 days.
I think with your FICO score being so high you can qualify for a loan in the 4-5% interest rate range and still not have to provide any income verification.
Your best bet might be to go through a conventional bank or mortgage broker unless you need to close earlier than 30 days.
This loan fits my situation exactly. Could I have the information to contact this lender?
Thanks,
Justin Slade
I to would be interested in knowing this lender. I am interested in finding a lender who would will provide a No Doc loan without providing a huge down payment. My FICO is also in the upper 700's but since I have gone full time at this I have not found a lender not requiring at least 30% down for the deal. Any suggestions would be greatly appreciated! Thanks
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Thanks,
Justin Slade