Hard Money Lenders Salt Lake City: Flexible Financing
2 min read
If you’re looking to fund your next real estate project in Salt Lake City, have a tight deadline, and need quick funding, you might want to consider a hard money loan.
Whether you aim to renovate a property in Sugar House or acquire a rental unit in The Avenues, hard money lenders in Salt Lake City can provide the speed and flexibility you need.
Hard money loans are an alternative form of financing that differs from traditional loans and are particularly useful for those with tight project timelines, limited startup capital, or credit issues.
If you’re not a real estate investor but need to bridge the timing gap between buying and selling a home, we’ll share some alternatives to help you leverage your home’s equity.
This guide will explain the essentials of hard money lending in Salt Lake City, helping you decide if this financial tool fits your real estate investment or home-buying goals.
Editor’s note: This post is for educational purposes and is not intended to be construed as financial advice. HomeLight always encourages you to consult your own advisor.
What is a hard money lender?
A hard money lender is a private individual or company that offers short-term loans secured by real estate. Unlike traditional lenders, who focus heavily on the borrower’s creditworthiness and income, hard money lenders in Salt Lake City prioritize the value of the property being used as collateral.
Their loan programs are popular among real estate investors, such as house flippers and those buying rental properties, who need quick access to funds and flexible terms. Hard money lenders use after-repair value (ARV) — the estimated value of a property after all renovations and repairs are completed — to determine the loan amount they are willing to offer. They’ll typically lend a percentage of the ARV to ensure the investment’s profitability and security.
Hard money loans typically have higher interest rates, ranging from 8% to 15% or more, and shorter repayment periods, usually between 6 to 24 months. Additional costs can include origination fees, closing costs, and points, which are a percentage of the loan amount paid upfront. As with any secured loan, failure to repay a hard money loan can result in the lender seizing the asset, such as a house, to recover their investment.
How does a hard money loan work?
If you’re a real estate investor looking for a financing option that provides speed and flexibility, connecting with hard money lenders in Salt Lake City could be beneficial. Here’s a quick rundown of how hard money loans work:
