Comments on: Hard/Private Money

By: Angie Williams

Angie Williams — Thu, 27 May 2010 01:38:34 +0000

If the mortgage brokers run out of product or are unable to compete with pricing then yes they will have to resort to adpating to the sale of hard money relationships or providers. It certainly is becoming increasingly difficult for broker shops to make the money they once did. Some consumers have a need for funds and are willing to pay the premium. If all are licensed and practice as professionals and there is transparancy.. then it shouldn’t matter what product they provide.

By: Bryce Zimmerman

Bryce Zimmerman — Sat, 22 May 2010 01:03:45 +0000

With the 2010 GFE it is more difficult for the broker to compete because of disclosing the ysp. A bank isn’t required to disclose the srp since it isn’t guaranteed or realized at the closing. It it probably more important now for broker to increase the avenues of business so I wouldn’t be suprised to more doing hard money loans.

By: Elisa Wu

Elisa Wu — Mon, 01 Mar 2010 00:43:18 +0000

It’s good there are many options of loans, but the hardmoney loan just not practical for most of people.

By: Daniel Mulvehill

Daniel Mulvehill — Fri, 26 Feb 2010 23:07:36 +0000

Hard money loans they have there place an need positive and negative. If you need quick financing and obtain the property for a flip this helps the economics and employment sector. You have t factor in the higher interest rate and fees, but the return should be on you final objective. Some traditional Banks and others can’t help so Hard Money may be the answer.Also by borrowiing under this format, you must have an Exit strategy to be successful definately.
I my opinion the more equity you can bring to the table this allows you to have more flexable alternatives to pay back the loan and move forward.

By: Melinda Willard

Melinda Willard — Fri, 15 Jan 2010 21:57:52 +0000

Jillayne:

Thank you for your response. I was skeptical and had only worked directly with my “banker” before (a VP, Business Banker at a major bank) so I was doing some research before moving any further. I appreciate your input and I am impressed with your site and the information contained therein. I will visit again. Have a great weekend.

By: Jillayne Schlicke

Jillayne Schlicke — Fri, 15 Jan 2010 20:33:36 +0000

Hi Melinda,

The website looks pretty childish and there is NO information on the site about how their company is licensed. I’d guess this is a one man shop. Chances of this person being licensed in all 50 states is zero. Instead, he probably brokers to lenders in various states.

I highly recommend working with someone local, in YOUR city/state. There are plenty of licensed mortgage brokers who have access to many different hard money lenders. A broker will typically work on your behalf to find the mortgage money for you.

Best of luck! Stop back by if you have any more questions.

By: Melinda Willard

Melinda Willard — Fri, 15 Jan 2010 16:56:20 +0000

More of a question than a “response” – Does anyone know about obtaining lending through REI Solutions LLC aka Real Estate Investment Solutions LLC out of North Carolina, “able to do business throughout the U.S.?” The “marketing professional” says that I need to pay an upfront $795 fee to become a “member” to then be able to talk to a “Business Development Manager” about a non-owner occupied loan (NOO). I am a 10 year real estate investor with about 47 units and my regular commercial lender (major bank) has placed a hiatus on NOO loans and I’m looking for refinancing on a duplex in PA. These forum looks to be frequented by educated participants so I hope that someone has some information for me — either on REI Solutions or a potential lending source.

By: Kimberly Peterson

Kimberly Peterson — Thu, 31 Dec 2009 20:14:37 +0000

I also have many options for my clients and I can compete easily for the bank loans too! I feel I am a better option because it seems most of the bank lO’s are not very competant (I dont mean to paint all of them in this category just what I have been told by clients).

By: Karen Tuff

Karen Tuff — Thu, 31 Dec 2009 08:50:11 +0000

I like to have many options available for my clients even if it means sending them to a hard money lender. I see myself as a resource and I do everything I can to compete with the conventional solutions. And, if a hard money option is all that is available to meet their needs, I have researched the best companies to help my client find the best terms and cost available. I have built referral business by staying open to whatever best fits the client and referring them on if necessary.

By: Harold Burton

Harold Burton — Thu, 31 Dec 2009 04:12:52 +0000

Over the years I have been associated banks and freguently opted to stay on the broker side of the fence. I really think it boils down to what a individual feels confotable being involved with, bank or mortgage broker.

Aside for the non disclosure of YSP I have always been more comfortable on the broker side of things. The broker situations I worked in have always had licenses in at least twenty or more states.

I must say that thinking back I have always felt that I had a advantage being a broker.

As a broker I always thought Hard Money loans where a part of our niche market. Sort of like a customer service tool.

By: Kelly Fiscus

Kelly Fiscus — Wed, 30 Dec 2009 23:28:38 +0000

Brokers will need to provide a value added service. Our industry will need to stay on top of what is available and provide better service than the banks. As we all know not every client falls into a nice, neat, easy loan package.

By: Chris Yanke

Chris Yanke — Wed, 30 Dec 2009 22:54:34 +0000

I think Brokers competitive angle needs to be service based. Banks might not have to disclose the YSP in their GFE’s (changing soon) but at the same time Banks are not known for efficiency and can add sometimes weeks if not months to a transaction. With Hard Money your usually doing more than just providing a loan, you’re usually giving someone a needed break to develop a plan to either sell their property and preserve any equity and their credit. Or you’re helping them buy some time to address property issues and prepare for a sale. Hard Money transactions are just that HARD. I’ve worked on 4 of them in my life and I do think that banks and brokers should view them as competition given the segment of the market they operate in.

By: Kelly Fiscus

Kelly Fiscus — Wed, 30 Dec 2009 21:21:15 +0000

I think brokers will need to find their own personal market, some will want to complete against banks for vanilla leans, and I think others will find a niche to market themself. I think brokers will once again become great value to the client that falls outside of the banks tradiional lending practices.

By: Arash Fiuzi

Arash Fiuzi — Wed, 30 Dec 2009 09:18:05 +0000

Self directed IRAs can be a great source of Private money. Everyone has a rich uncle.

By: James Haechler

James Haechler — Wed, 30 Dec 2009 05:40:59 +0000

Sure Brokers could compete with Banks for those vanilla type loans. In fact most Brokers have access to hard money lenders where most banks won’t deal with it. I think banks will edge away from non traditional loans. Thats where a Broker will be a big service in providing lenders of hard money and other types of loans.

By: Jason Brock

Jason Brock — Wed, 30 Dec 2009 00:23:05 +0000

Hard/money lending
I feel blessed to know quite a few people who still lend on a case by case basis for not only residential lending but other types as well. It is nice to have that edge on my competition. I am going to be and am still more competitive than any bank, hands down. even in conventional lending

By: Jerrod Goode

Jerrod Goode — Mon, 28 Dec 2009 19:10:15 +0000

Brokers will need to stay educated on all possible avenues that could help their clients. This will be one way that a good broker will be able to stand out and provide solutions to people in communities that can not get help in traditional banks.

By: Launce Macomber

Launce Macomber — Mon, 21 Dec 2009 17:58:23 +0000

It may well be that the game has changed in light of the real estate debacle that has just beset the country. Banks are really going to put clamps on traditional lending guidelines and will almost certainly be precluded from any form of hard money lending unless the exit strategy is cast in stone. These circumstances should provide avenues for brokers to capitalize on demand for traditional lending and offer opportunities for creative thinking about hard money loans.

By: Jan Mundt (Henriksen)

Jan Mundt (Henriksen) — Sun, 20 Dec 2009 05:36:11 +0000

If you were working for a bank with sufficient, price competitive products to offer your client, why would you consider brokering your vanilla loan? Other than the “special needs” situation, I feel there is no need to broker. Now that Government transactions have returned(FHA/VA/USDA)and you have other competive programs as well, I fail to see a logical reason to broker the loan.

By: Ken Ritter

Ken Ritter — Fri, 11 Dec 2009 00:15:11 +0000

I see no reason why a broker would not be able to compete with the banks on a vanilla type of loan. I do think that brokers have more avenues to search on for the type of loan that fits the borrowers needs as well as the broker is not tied to the banks requirements and therefore may have more flexibility to get the loan funded where as a bank employee may be tied to the banks requirements and restrictions.

By: richard martin

richard martin — Wed, 09 Dec 2009 03:26:01 +0000

I do not see why a qualified experienced Broker could not compete with Banks in the standard vanilla type loan products,after all the Broker and with great individual experience in making things work has smany avenues to check out.
I think a Broker should be able to find financial solutions for special situations outside traditional guide lines where a Bank might be curtailed or not be as flexible or as creative as a savey Broker.

By: Teresa Gallaher

Teresa Gallaher — Fri, 04 Dec 2009 20:40:03 +0000

With the changes in lending regulations for mortgage brokers, we have had to expand our sources for non-traditional money. However, I believe the broker can still compete with the banks for the vanilla mortgage products. Although banks do not have disclose yield spreads to the consumer, their rates tend to be higher than those the broker can get. Third party fees are comparable. The banks usually charge 1% origination and as a broker I too charge 1%. The difference is, I believe, the consumer gets a more one on one experience with the broker than the bank employee.