Your Guide to Hard Money Lenders in Milwaukee
If you’re planning your next real estate investment in Milwaukee, you might find that a hard money loan is your best financing option. Whether your sights are set on flipping a vintage duplex in Riverwest or nabbing a rental property in Brewer’s Hill, hard money lenders in Milwaukee can offer the quick and flexible funding you need. These loans cater to investors with time-sensitive projects, those with limited startup capital, or individuals facing credit challenges.
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 make the most of your home equity. In this article, we’ll walk you through the basics of hard money lending in Milwaukee, providing insights to determine if this financing method aligns with your investment or home-buying goals.
What is a hard money lender?
Hard money lenders are private individuals or companies that provide short-term, asset-based loans secured by real estate. Unlike traditional banks, they focus on the value of the property being used as collateral rather than the borrower’s financial history. Their typical clients include real estate investors, such as house flippers and buyers of rental properties, who require fast funding and flexible terms.
To determine loan amounts, hard money lenders rely on after-repair value (ARV), which is the property’s estimated worth after renovations. They typically lend a portion of the ARV to secure their investment. These loans come with higher interest rates, usually between 8% to 15%, and additional fees such as origination, closing costs, and points. If a borrower fails to repay, the lender may foreclose on the property to recoup their investment.
How does a hard money loan work?
If you’re looking to finance your real estate project quickly and with more flexibility, hard money loans in Milwaukee might be the solution. Here’s how these loans typically work:
