What is a hard money loan? What is a stated income loan?

Answer 1

A hard money loan is a very high interest loan for someone who has alot of equity but very bad credit. It can also be for "strange" properties that cannot get conventional financing.

A stated income loan is a loan where you state what your income is on the application and do not have to prove it with paystubs etc. These types of loans generally require good credit scores and for you to have money in the bank as reserves.

Answer 2

Hard money loan are the loan where people can borrow money. where loan provider charges high interest instead of equity but really small benefit for loan holder.

A stated income loan is a loan where you state what your income is on the application and do not have to prove it with paystubs etc. These types of loans generally require good credit scores and for you to have money in the bank as reserves.

Answer 3

Hard money loans are for people who have horrible credit, below 600 and even below 500, but have a fair share of equity. The hard money lenders are not institutional and usually privately funded capital. They have extremely high interest rates, 10+ , because they can get away with it. They're usually the only people who will lend that money cause its such a high risk case.

Stated income loan is where you only state the income on the loan application and they lender doesn't ask you to prove it with tax returns or pay stubs. The lender will verify that you have the job ie they will call your employer and ask if you work there. If you are self-employed, they will condition you for a CPA letter verifying you are self employed. Unlike the last two answers, you don't neccesarily need good credit to go stated. There is usually an add on to the rate or margin, but most programs will let you go stated ( there are some guidlines though).

Answer 4

hard money loan are for people who can't get a loan anywhere and can only borrowe from hard-money lenders. Typically you can only borrower 65% of your home values, interest rate are ranging between 10.99% - 12%+. Not to mention you have to pay 1 - 2 % cost to the lender just to get that high interest rate.

Stated loan is when you "state" the income instead of providing them verifiable proof (like paystubs, W2's). Most self-employed people are on "stated income" loans since they cannot provide full tax return (why? too many writeoffs = very little income). Depending on which lenders your loan is with, normally you would need a 680 mid fico score to qualified for "stated income" (for a good rate) but some lenders would go as low as 580 (won't be a good rate). Although you state your income, but it has to be consistent and realistic w/ your profession and years in the industry. You just can't "state" a janitor making 5K a month.

Answer 5

Hard money loans are loans in which real estate serves as the collateral asset. It is most commonly used as a type of bridge loan for temporary financing. As with other collateralized loans, the size, rate, and length of a hard money loan is determined by the borrowers equity in the asset, the volatility of the asset and marketplace, and the financial standing of the borrower. Hard money loans http://www.kennedyhardmoneyfunding.com are funded for business and personal use.