Discover Hard Money Lenders in Maryland for Fast Funding
Are you eyeing a real estate investment in Maryland but finding traditional financing options out of reach? Whether you’re hoping to revitalize a row house in Baltimore or purchase a commercial property in Annapolis, hard money lenders in Maryland offer the speed and flexibility you need. A hard money loan could be the perfect solution for those with short project timelines or challenging credit situations.
In this article, we’ll walk you through the essentials of hard money lending in Maryland, explaining how these loans work, their costs, and potential alternatives. If you’re a local investor or a homeowner looking for quick financial solutions, you’ll find valuable insights to help you make an informed decision.
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 provides short-term, asset-based loans secured by real estate. Unlike traditional banks, hard money lenders in Maryland focus on the property’s value rather than the borrower’s credit score. Their primary clients are real estate investors, such as house flippers and those purchasing rental properties, who need quick access to funds and flexible terms.
Hard money lenders use the after-repair value (ARV) — the estimated value of the property after renovations — to determine the loan amount. Typically, they lend a portion of the ARV to ensure the investment is profitable and reduce their risk.
Interest rates for hard money loans are higher, ranging from 8% to 15%, with additional costs like origination fees and points. If a borrower fails to repay the loan, the lender can seize the property to recover their investment.
How does a hard money loan work?
For real estate investors in Maryland, hard money loans offer a unique blend of speed and flexibility. Let’s take a closer look at how these loans work:
