Hard Money Lenders Indianapolis: Secure Your Next Deal
Looking to up your real estate investment game in Indianapolis? Hard money loans could be your ticket to faster funding and flexible terms. Whether you’re eyeing a fixer-upper in Fountain Square or planning to renovate a commercial property near Mass Ave, understanding how hard money loans work can be crucial. These loans focus more on the value of your property than your credit score, making them accessible to a wider range of buyers.
In this article, we’ll explore the ins and outs of hard money lending in Indianapolis, from loan structures to costs, and introduce some top lenders in the area. We’ll also discuss alternatives for homeowners needing to bridge the gap between buying and selling a home. By the end, you’ll be able to determine whether this financial strategy aligns with your real estate 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?
Hard money lenders are private investors or companies that offer short-term, real estate-backed loans. Unlike traditional lenders, they focus on the value of the property being used as collateral rather than the borrower’s credit score. Their primary clients include house flippers and rental property investors who need fast access to funds and flexible lending terms.
These lenders use after-repair value (ARV) — the projected value of a property post-renovation — to set loan amounts. Typically, they lend a percentage of the ARV to secure their investment. Interest rates on hard money loans are higher, often between 8% and 15%, with additional costs like origination fees and points. If a borrower defaults on the loan, the lender can take possession of the property to recoup their funds.
How does a hard money loan work?
If you’re seeking a flexible and speedy financing option in Indianapolis, hard money loans might be the perfect solution. Here’s a brief overview of how they work:
