All About Hard Money Mortgages in Florida

Hard money mortgages offer mortgage refinance at a higher rate of interest to borrowers with poor credit histories. Borrowers with poor credit histories can use the property as collateral to obtain a mortgage refinance on 50 to 75% of the market value. The hard money lenders will require equity in the property.

You can also hire the best hard money mortgage lending services in Florida.

Hard Money - Overview, Pros and Cons, Examples

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Hard money mortgages were first introduced in the 1950s. More people use the term "hard money mortgage" than usual. The ratio of loan to value was lowered after the collapse of hard money mortgages in the early 1980s and 1990s by mortgage lenders. The meltdown was caused by property financing that exceeded its market value.

In extreme cases of poor credit history, banks and financial institutions will normally refuse financing. The borrowers initially seek mortgage refinance on a traditional mortgage refinance. The borrowers then seek hard money mortgage refinancing after exhausting all other options.

Hard money lenders are usually the investor's trust, group, or private individuals. Hard money lenders are more risk-averse than banks and financial institutions. The borrowers are charged between ten and nineteen percent interest rates in return. 

Hard money lenders can charge twenty to twenty-nine percent if the borrower defaults in making mortgage payments. Normally, the annual percentage rate ranges between nineteen percent and twenty-eight%.

Hard money mortgages always have points. Normally, you will see between four and ten points. The borrower stops the foreclosure or quick sale of the property.