Which Type of Properties Are Best Suited For Hard Money Financing
                     Which Type of 
Properties Are Best 
Suited For Hard 
Money Financing
www.acalending.com
Being an asset based loan, hard money loans for real estate are effective for many kinds 
of properties. Each hard money lender in California has its niche in the real estate 
sphere that they have experience on & are comfortable to make loans with that property 
as security. Many hard money lenders give financing for residential properties, but in 
some scenarios they will also provide financing for commercial properties. These 
property types encompasses multi-family, industrial, retail, hotels, office buildings, etc.
Not all California hard money lenders provide loans for these kinds of properties, as they often 
tend to finance properties that are easier to sell. Several real-estate investors that look to get hard 
money financing are seeking to fix & flip properties. The objective of a fix & flip is to buy property, 
revamp it, and then sell for profit.
There’re 3 main kinds of properties that hard money lenders look for when giving loans. Hard 
money financing is most helpful & sensible for these 3 kinds of properties. The first is loans for new 
construction of single family homes. The second are loans to finance purchases & renovation of a 
quick sale property or fix and flip. The third is bridge loans that are employed to buy smaller earning 
properties or provide short term funding. These kinds of properties are ideal for hard money 
financing as they are usually best suited for a short-term investment. The majority of construction & 
renovation projects work on shorter time frame which makes hard money loans the most helpful to 
the borrowers. These properties are the collateral required to apply for the loan by utilizing the 
value of the property after revamps, alongside the cost of the overall construction.
For a borrower to obtain hard money funding, loan to value is one of the most important ratios 
involved. Many hard money lenders require a loan to value ratio of 75% or less, although there 
are times when this ratio can be higher. With this in mind, there should also be a secure exit 
strategy for selling or refinancing the property, followed by equity involvement from the borrower, 
personal guarantees from the borrower, and agreement to monthly interest payments. When 
deciding on the factors of the borrower’s loan, a hard money lender will take all these into 
consideration.
Contact All California Lending now if you want to work with the best hard money lenders in 
California.