HOW HARD MONEY LOANS WORK

[@RichardxRunit]

You couldn't have explained it any simpler, really appreciate the content bro. You're going to be a top finance KZbinr in no time!

[@bridger_pennington]

Thanks Richard, that means a lot man👊

[@Waxthomas9477]

@@bridger_pennington so what what’s consider worth it for hard money lenders like what do you guys look for as worth it in returns? Do they loan to people who plan on spending no more than $120k on a property and renovations? What depicts the returns that the lenders want

[@ameliaserrano145]

You also have to include the commission you pay the realtor to sell your home and closing costs.

[@tonyrosab2266]

And I don’t think it’s 80k it’s 30k or less . Because out of the 80k - 50k (rehab costs)= 30K

[@blanco1301]

@@tonyrosab2266 still not bad profit wym

[@Freelarryb]

Why investors buy off market

[@justinpdube]

Seller side typically pays

[@justinpdube]

What lender is giving 100% of purchase price?

[@whitneybroomfield8646]

I am a commercial lender with Lend Base we offer asset based loans to help you free up your collateral we do everything under the sun. Fix & flips, land loans, farm loans, DSCR loans, equipment loans, bridge loans ,Hard-money anything that you need. This was one of the best explanations of a hard money loan that I have heard! Keep up the good work. 😊

[@thefeloniousscot3955]

...and I want you to do a video showcasing your operations!

[@nicholassmith613]

So from what I’m understanding it’s not good to use hard money loans for rental properties, because you can’t get that full amount back within that time zone? If that’s the case, but need a fast loan, what about getting a hard money loan to go ahead and get it moving, then going to a bank for a loan to pay that hard lender back in time and pay the bank out over time?

[@guidingchangesllc.2911]

How can I get out of a hard money loan with bad credit

[@damianmelendez6128]

Man you broke it down really well and easy to understand! Great teacher fs !!

[@bridger_pennington]

I appreciate that!🚀💯👊

[@teodorpodaru7813]

But how much will gap investors interest be? Thank you for the video

[@mynameiszaid]

Watching from Pakistan for Hard money investing company. A digital marketer agency owner who's running Ads for them. You couldn't have explained it better dude!

[@chilekwamwewa3129]

What's the name of the same Hard money investing company?

[@Clovistered]

Thanks for explaining this dude that was really informative ! Going to check out the rest of your content p

[@bridger_pennington]

Awesome, thank you!

[@beast4548]

No time is right, like never

[@DanyCesc83]

I'm actually looking into becoming an investor in hard money loans, it seems like good option to diversify one's portfolio.

[@JeffCichocki]

It's a great way to make money and diversify. All of our funding tgat we do comes from private investors.

[@isaac8560]

How did it go ?

[@gonzojr80]

Great video, only problem I see is that you have in the example AUCTION property, please let me know which hard money lenders give loans for AUCTIONS and I will be first in line to get a deal done. My experience is that no hard money lender gives money for AUCTIONS. Please clarify

[@YungDelirious]

Phenomenal explanation thank you

[@egpipkin]

this is awesome. after i sell 3 of m rentals, will have cash, but want to do hard money n flip like 3 r 4 a year. very helpful. thanks for it.

[@ibifsha]

What do you use to track payments from borrowers? so far I'm using excel sheets but wondering if there is an easier platform to make sure all money came in on a monthly basis

[@stfu4159]

But how does the process work? Do hard money lenders need tax info or just require credit score only?

[@rodolfoamador940]

No they dont, they want to know the home is a good deal, they dont care about the other stuff, make sure the deal is good and youll get the money

[@raziqrahim5610]

They don't thats why the charge alot more interest than bank to cover the risks. They just wanna know whats the money for and isit reasonable.

[@zoniapatreece1324]

If your score is below 650-620, they will not lend to you. They will ask you to get a partner. Especially if this is your first flip. They also want you to put a downpayment on the loan.

[@unggoy8564]

Excellent presentation!

[@zesilva5062]

Hi Bridger, Keep up the good work, with time you'll get to a big audience with your highly valuable content. An idea for a video, that I would love to watch and learn, is how to manage the day to day of a fund. The people structure, software you use, etc. Cheers and congrats for great work

[@bridger_pennington]

Thanks for the idea!

[@williamandam3228]

will appreciate that too, want to start a fund

[@JeffCichocki]

Overall, really good info. But I do need to correct one of your statements. The name Hard Money has nothing to do with it being expensive. It’s called Hard Money because the loan is against a Hard (physical) Asset. Hard Money lenders are asset based first and foremost. Yes, most check credit to make sure that the individual is a good risk, but the hard asset is the most important thing in the loan. The reason that Hard Money is expensive because it’s a considerably more risky loan than a traditional loan that a bank will do (most banks won’t lend on properties that need renovations/rehab - yes I know that some will). Most hard money loans are against property that needs work. The reason it’s riskier is because as soon as the demo starts, the house becomes worth less. It’s not worth what the loan is based on until the renovations are complete. One other thing, you really should have gone into why Hard Money lenders typically stop at either 65% or 70% of ARV for their loans. Your example of the $800K loan on a $1M property is never going to happen with a professional Hard Money lender. An 80% LTV is to risky in asset based lending.

[@wannabedal-adx458]

Good points. The clarification you made are in line with what I have heard as well (still a good video I think). Question for you, which valuation figure do most hard money lenders use, LTV or ARV (After Renovated Value?)?

[@JeffCichocki]

@@wannabedal-adx458 both are important. Ltv is typically based off of arv (most hml's require appraisals to determine arv).

[@mr.g1683]

Where are the investors to buy into partnership for properties that earn monthly income? I have not seen any videos or website that network people towards this subject when persons have a property that needs investors to bring cash $$ towards getting the build out complete to then be able rent out..

[@camerondierking7644]

You sir, you are a hero!

[@ghlu7694]

Wow. Good job. Can I invest the money I have in my TFSA in private lending business. Do I need to incorporate the company? How will the profit be taxed? Do I need to have a trustee, like Olympia trust or computer share to transfer my funds from TFSA account to the private lending business account? Thank you.

[@mrarfarf]

Great video! Amazing content, thank you and keep it up please!

[@anand2760]

great articulation!!!

[@CesarMartinez-km4uk]

This was awesome. I just want to add that 80k profit - 50k put for rehab. Would leave a profit of 30k. Correct? What happens to the closing cost expenses? 🤔

[@mrisen20]

i think you make your 50k back from the sale of the property. from the 400k, 250k back to hard lender and 50k rehab back to you. 100k left over before loan payment.

[@inpiecesa1956]

So he explained it as you make $100,000 after paying the $250,000 back and paying yourself the $50,000 back. Then you have to pay the interest on the loan is $13,750 but yes he did forget to mention the closing costs but if you look back at it he said "about $80,000 is profit" because he was adding in the closing cost but he never mentioned it.

[@darieldelosreyes4397]

I'm thinking about using a hard money loan to buy a Fixer upper single family home. I'm currently living in a duplex I bought. If I buy a single family home, fix up the home, and then refinance, would they look at the debt from the hard money loan when calculating my DTI?

[@IntermountainGoldRefiners]

Thanks for answering this topic.

[@elle5031]

So Thank you for your information. I was wondering if you wouldn't mind answering two questions. Could a hard money lender take possession of my property other than if I were to default on payment? And why would lender ask me to put him on my home owners ins? REALLY APPRECIATE your help.....I'm getting cold feet about the deal.....

[@armandocabrera5174]

How did your deal go? Looking to venture into hard money loan but I have been doing a ton of research first.

[@LottyhanzFamilyties]

3:04 where tf did you get the 400k selling figure?? Wouldn’t you get an appraisal before coming up with a random number to sell?

[@fafdus]

how do i find the cheap houses

[@giocorpus444]

Can you do a video on how to start a bank and investment bank

[@JohnDoe-fs6lz]

Like the required down for the loan you would provide? Very informative video.

[@nobody123-b5r]

Wait I’m lost…..What if you’re not trying to flip the house but instead trying to rent it out? When will I have to return the money? Especially if I’m in it for longevity?

[@powercapitalsolutions]

Great question - you can always refinance out of the hard money into a loan amortized over say 30 years or so. Keep in mind, you must meet the credit requirements for refinancing (which are always going to be higher than fixing and flipping).

[@Marisamonique94]

Thank you so much !

[@henrypowers4295]

Great content brother!!!!!

[@jennyingram482]

Is a LOC the only option for the renovations, or can the renos be rolled in to the hard money loan itself?

[@tracythompson6795]

This was very informative. Quick Question if you are needing the LOC do you just tell the Lender and is it a qualification process for the LOC for the Rehab?

[@josejka]

Just watched the video was awesome but after the math is done wouldn’t the profit be 30,000 as you would’ve recover the 50,000 you put in for upgrades? Or am I missing something ,but either way it seems like a great way to make money. Thank you bro for the information

[@raziqrahim5610]

Line of credit would've be added to the amount of loan when its matured so 250k+interest+50k from line of credit. Im not very sure if this 100% correct but so far i perceived it like this. Hope it helps😀

[@andregraf3000]

The $50k was already included on the original number, when he talks about the remaining $100k "Profit", he already added that on the original $250k loan. The only remaining amount to deduct after that would be the $7,500 & the loan interest (which he shows as a $20k total cost). This leaves a remaining profit of $80k.

[@290CityLights]

Great content!

[@bridger_pennington]

Thank you!

[@dj39st]

Perfect explanation…

[@dompurpura]

Very well explained!! Thank you so much

[@KevinSmith-oz5oz]

Asides the paperwork and terms being on point. Since this is your personal money, are you still claiming short term capital gains. Dealing with taxes, even though your not running your hard money lending as an llc business. Or are you? Thx

[@bm6003]

I bought a condo as investment with hard money loan.. I am thinking to refinance with other banks for lower interest rate.. any suggestioN..?

[@mattkeese7956]

Thanks bro

[@raquelking8557]

Very straightforward and easy to digest! Thank you

[@yourfirstdeal]

Thank you

[@lifewithchicago5282]

So how about buying a 100k home needing complete rehab and needing a 60k repair and realtor saying it will sell for 240-260k about how much real profit can I make with a hard money loan

[@CosmicMillionaire]

Perfect way at explaining it. The only thing i didnt understand was the 11% thing were you converted it to 5.5%. can anyone help me understand please?

[@malts100]

Hi I would like to ask how did you get the 5.5% from the video could you provide some formula? Thank you! I really have trouble understanding it.

[@geoffneale87]

11% annualized is 11% over 12 months. If the loan is for 6 months it is one half of the 11%, or 5.5%.

[@nsbil1]

What happens if you're not able to to sell it for a loss. You still owe hard money lenders? Will it go on your credit?

[@kingamir7487]

Yes if you don’t end up selling you will have to refi with a bank because more than likely hard money lenders are balloon payments which means it has to be paid in full in 12 months. So you would refi with a bank to give you more time to sell.

[@JohnDoe-fs6lz]

So for a 300k house how much would you charge ?

[@edifymeblog7076]

What about if it is a pie and hold property? How does it work when you pay back the hard money lender?

[@edifymeblog7076]

Buy and hold lol

[@nitrospark1374]

im confused on where the 50k would be coming from. would it make sense to apply for a grants/loan for that 50k?

[@ArtisticallyAspiring]

Can your do this example on a fix and flip? I just like the way you explain it.

[@supergirl2997]

Profit of 80k but you forget about agent commission and capital gain tax. 80k turns to 40k real quick.

[@mikejohnr1315]

I'm a new hard money lender. I've closed three deals and am looking for more property flippers. My problem is that people don't know I'm here and I only want to work locally. I want to be able to drive by the properties without it being a big deal to me. My question, how do I find more people looking for money?

[@fritzthedragon]

where are you located?

[@mikejohnr1315]

@@fritzthedragon MA

[@milesfabishak2354]

Will this strategy work with buy and hold?

[@lkj809]

Great work. Thanks

[@bridger_pennington]

Thank you too!

[@jermainedavis6994]

What if you own the home free and clear. Is there a minimum to do a total reno?

[@brandtem]

You didn't subtract realtor fees when you sell.

[@TheGoldBullet2you]

Actually he's assuming you are making the deal off market

[@DennisHenderson-ux4ev]

Great video How did you get the 5.5% again?

[@MrMatute7]

11% is the annualized rate, since his example is for 6 months you divide the 11%(12months) by 2 and you get the 5.5%

[@gina4319]

how to get proof of money from hard money lender to buy Hud home

[@skylerhilton857]

can a hard money loan also include refinance cost

[@GenK1991]

Would you recommend this kind of loan to buy and hold a multi unit?

[@rubengaitan9763]

Do you lend in California?

[@bridger_pennington]

Yes, I have before!

[@dennisdeleon7417]

Great video Bridge

[@bridger_pennington]

Glad you enjoyed it

[@gnicholsification]

I'm trying to do a hard money loan in central FL. How can I contact you?

[@Marisamonique94]

Do you have to have amount of reserves required plus the borrower funds in your bank at the time of closing ?

[@CesarMartinez-km4uk]

I am currently on the process of closing my first property. The lender required me to have 6months of payments in the bank account.

[@JorgePizarroFilms]

With what company?

[@jasonmartin1712]

Do you find that most hard money lenders charge a fixed percentage regardless of the loan term, or are most of them wanting a percentage annualized?

[@bridger_pennington]

Most hard money lenders charge interest on an annualized basis, meaning the percentage is tied to the length of the loan term. However, some may also charge a fixed fee or a minimum percentage regardless of the loan term. Terms vary widely between lenders, so it’s important to review the specific terms of each loan agreement. This is for informational purposes only and not financial advice.

[@stanislavdidenko8436]

How often do landers just steel the information on the on the profitable deal and do it themselves or just give their flipper partners? How can flipper protect in such cases?

[@ColeSonMusic]

Great video. Tx

[@OGKennyLee]

You didn't mention real estate agent fee's and closing cost deduction from the 80 grand

[@LouBloom21655]

Wait, didn't the investor make 30k in that deal? Not 80k. 50k was used for rehab of his own money

[@volunteer100]

Yes. That's what I was waiting for him to say.

[@rajakiros1597]

50k rehab was added to the 250k The property sold for 400 minus the fees Which you walk away with 380k the 80k profit

[@skiesofthesouthwest]

Where did the 50k come from?

[@mendozaraul6607]

Does the hard money lender pay the realtor fees?

[@tictac9367]

Can you do a video of getting a hard money loan against the equity in your home with no income verification and bad credit score

[@bridger_pennington]

keep an eye out👀

[@georgedelobos9755]

Just get a HELOC bro

[@tictac9367]

@@georgedelobos9755 thanks yeah ima look into it

[@tictac9367]

I looked into it basically same problem as a refi my credit is bad right now because of my high credit utilization I need a loan just based off my equity only but I guess there's nothing really out there

[@geminim3geminim384]

What about commercial 1.3M for a profitable running business .

[@sergecaliz3705]

Did you forget to deduct Commisions and Clossing costs?

[@IanTuckerCoaching]

Good video, very informative and on point. In the current rate environment we are in a HML is not that much more expensive now than a conventional primary residence mortgage and cheaper than a SBA loan

[@sarahkissaify]

Some cover the renovation cost roo

[@monikacharlesx]

This was so helpful and the video isn’t even finished playing

[@henrikjohansson4555]

it sounds that they are doing a 100% LTP (loan to price) but not a 100% LTV as the value is 350k? and therefore 71%% LTV?

[@michaelrainerii3547]

Great content. Thank you for breaking it down in extremely simple terms.

[@shaungorham5479]

Perfect.

[@hxmetours]

What protects the buyer from the lender giving away the deal to one of their buddy

[@billygibbs4769]

I need a sample contract so I can start lending.

[@MrFunnyXD]

thanks

[@JoseMacias-zn5cf]

I need some funds to buy a house

[@ThE4EvRPs3GaMeR]

Can a hard money loan be longer than a year. Say 3 or 5yrs at the most? I have an idea but it wont work if it's only a year loan. Ill need 3yr at least.

[@bridger_pennington]

Hard money loans can sometimes extend beyond the typical 12-month term. While many are short-term (1 year), some lenders offer terms of 2-5 years depending on the project, lender policies, and collateral. Discussing the plan with potential lenders can help find terms that fit longer timelines.

[@DB-pi7yg]

Can I borrow money to get a house out of debt and then turn around and sell it?

[@bridger_pennington]

Yes, it’s possible to borrow money to pay off a house’s debt and then sell it. This approach is often seen in real estate investing or house flipping. Factors like loan terms, interest rates, and the property’s resale value play a big role in whether it makes sense financially. Consulting a real estate professional or financial advisor can help assess the specifics. This is for informational purposes only and not financial advice.

[@derrickjohnson3817]

He didn’t make 80% profit when he put up his own $50,000 for rehab more like $30,000 profit

[@bmachelle2494]

Thanks much sir . I understood you very well . As a new investor, haven’t flipped anything would it be wise to work with one property?

[@bridger_pennington]

Yes, I would just start with one syndication deal you can learn more about them here kzbin.info/www/bejne/pabRhKWJoLV9h7s

[@fallenamerica1475]

What about closing costs when selling, seller finacing fees, real estate fees, etc... thats -$25k from your $80k which leaves you at profit $55k

[@LS-sm5xh]

so you're saying you're a glass half-empty guy :)

[@gr-yl1jt]

Bro

[@elkokeraliuga8556]

What if property does not sell within 6 months, I am pretty sure there is a big fee or penalty the investor will have to absorb.

[@kingamir7487]

No you will want to refi with a regular bank to pay that back.

[@st77tx99]

ARV..After "Repair" Value...broski. ...and transfer of funds always happens at Title. No chance of skipping out to the Bahamas 😆

[@chadmckeighan6726]

I'm looking for a 25000 loan on a property that is in South America. I believe it would be a great Airbnb investment. Does anyone know the best route to obtain a loan without going through conventional financing?

[@PlanetLibrary]

1:28 for those who hate yapping

[@loadingless3406]

good vid

[@spityogame]

Is there anyway to do this type of video on a fix and flip properties because I am about to get into that business and you explain things so well !

[@bridger_pennington]

No promises, but I'll add it to my list!

[@jadonneuhoff6184]

Why wouldn’t a house flipper just get a loan from a bank for lower interest rates?

[@tjlift22]

I love how it cut off in the middle of the video 🤦‍♂️

[@tradethelingo]

Meanwhile, I'm a Bahamian trying to learn this.

[@MM-cn4jq]

Excellent

[@bridger_pennington]

Thank you! Cheers!