Question:

What is a hard money construction loan?

Answer:

A hard money construction loan is a loan offered for building or improving residential or commercial properties. The collateral for the loan is the value of the project after completion. Funds are scheduled for disbursement as work progresses.

Who needs a hard money construction loan?

Borrowers who can't quite qualify for a conventional construction loan may be told they need a hard money construction loan. This is especially true if you need construction financing for commercial properties. Hard money loans are usually private money and the state you want to build a commercial building may not be attractive to commercial lenders.

Some investors or those wanting a custom built expensive residence find it more convenient to turn to private money construction loan lenders because restrictions are much looser to compensate for the rates.

Recommended helpful present and future homeowners links:
Why: Refinance to a fixed rate loan while mortgage rates are still low.
Link:
Why: Because FHA loans are insured by the US Federal Government they have very competitive interest rates and are easier to qualify.
Link:
Why: Know and protect your credit report and score.
Link: See All 3 National Credit Scores & 3 Reports Instantly, Online & Free
Why: Find your next home and save money.
Link: Search thousands of foreclosures. Free 7-day trial.
Link this QnA Print del.icio.us Digg
Was this Mortgage QnA helpful?
Not at all
  • Currently 3.1/5 Stars
  • 1
  • 2
  • 3
  • 4
  • 5
 Definitely
Add to this Answer

Mortgage QnA is not a common forum. We have special rules:

  • Post no questions here. To ask a question, click the Ask a Question link
  • We will not publish answers that include any form of advertising
  • Add your answer only if it will contrubute to the quality of this Mortgage QnA and help future readers
If you have trouble reading the code, click on the code itself to generate a new random code. Verification Code Above:
Bookmark and share this QnA:

Common misspellings: mortage and morgage