Hard Money Lenders Los Angeles: Quick Funding Options
Looking to fund your next real estate venture in Los Angeles? Whether you’re aiming to flip a historic Craftsman in Echo Park or invest in a rental property in Silver Lake, hard money lenders in Los Angeles offer the flexibility and speed needed to close the deal. These loans provide an alternative to traditional financing — perfect for those with tight timelines, limited initial capital, or credit challenges.
Not just for seasoned investors, hard money loans can also benefit homeowners needing a quick funding solution. This article will guide you through the essentials of hard money lending in Los Angeles, helping you determine if this financing option aligns with your real estate goals or home-buying needs. If you’re a homeowner looking to bridge the gap between buying and selling, we’ll also explore some useful alternatives.
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 loans secured by real estate. Unlike traditional lenders, who emphasize the borrower’s credit and income, hard money lenders in Los Angeles tend to focus on the property’s value, which is used as collateral.
These lenders often work with real estate investors, including house flippers and those acquiring rental properties, who require quick access to funds and flexible terms. Hard money lenders determine loan amounts using the after-repair value (ARV), which is the estimated value of a property after renovations and repairs are completed.
Interest rates for hard money loans typically range from 8% to 15% or more, and repayment periods are usually between 6 to 24 months. Additional costs include origination fees, closing costs, and points. If a borrower fails to repay a hard money loan, the lender can seize the property to recover their investment.
How does a hard money loan work?
For real estate investors in Los Angeles seeking fast and flexible financing, hard money lenders might be the ideal solution. Here’s an overview of how hard money loans work:
