When are hard money second mortgage loans used?


Hard money second mortgage loans are subprime second mortgages offered to borrowers with FICO scores below 500. Essentially, they are bad credit mortgages that can be fixed or adjustable rate and reach 120% LTV. Hard money second mortgage loans are mostly used for consolidating other high interest debt and credit cards.

Even though you may have enough equity in your home, only some lenders will be willing to help you get a short term hard money loan if you have a score below 500. No doubt many lenders will reject your hard money second mortgage loan application due to your credit since you probably have lots of delinquencies and possibly bankruptcy and/or foreclosure.

Sometimes hard money second mortgage loans are offered with no income documentation and are great for self-employed borrowers.

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