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Hard Money Loans

 

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If you’re a real estate investor in the Los Angeles South Bay who needs to finance a property quickly, a hard money loan might be right for you.

Since 2013, First Capital Trust Deeds (FCTD) has originated loans in Torrance, Rancho Palos Verdes, Manhattan Beach, Redondo Beach, El Segundo, Rolling Hills, Hawthorne, Carson, Gardena, Compton, Paramount, Bellflower and Norwalk.

What is FCTD’s Experience with Different Real Estate Investment Scenarios?

First Capital Trust Deeds has worked with numerous real estate investors to secure financing for the following scenarios:

Redondo Beach Hard Money Loans

Understanding Hard Money Loan Costs

The expenses associated with hard money loans fluctuate based on factors such as the lender, the property, and the borrower. Nevertheless, several costs are standard for hard money loans, outlined below:

  1. Interest Rate: This charge represents the proportion of the loan amount that borrowers pay the lender to access funds. Hard money loans tend to have higher interest rates than conventional loans, usually ranging from 10% to 18%.
  2. Upfront Points: These charges are a percentage of the loan amount that lenders collect during the closing process. One point equals 1% of the loan amount. Borrowers can generally expect to pay between two and five points.
  3. Closing Costs: These charges encompass various services and expenses required to finalize the loan, including appraisal, title insurance, escrow and recording, among others. Hard money loans often have higher closing costs than traditional loans due to the these supplementary fees and charges.

To make a well-informed decision, borrowers should carefully compare the terms and conditions offered by different hard money lenders before applying for a loan. Additionally, it’s crucial to consider these costs when calculating potential returns on investment or profit margins.

For more hard money loan cost information, please read our in-depth blog post - Hard Money Loan Pricing, Interest Rates, Fees, Closing Costs.

Torrance Hard Money Loans

What Sets First Capital Trust Deeds Apart?

What Sets First Capital Apart

Los Angeles South Bay Hard Money Loan Programs

Hard money loans can be used for a variety of different purposes. First Capital Trust Deeds originates the following types of loans for real estate investors:

Manhattan Beach Hard Money Loans

Pros and Cons of Hard Money Loans


There are several benefits associated with hard money loans, such as:

  1. Expedited approval and funding processes, which typically occur within days or weeks.
  2. Flexible underwriting criteria that prioritizes the property's value over the borrower's credit history or income.
  3. The capacity to finance projects that traditional lenders may not consider, including distressed or incomplete properties.

Despite these advantages, hard money loans also come with certain disadvantages:

  1. Higher interest rates and fees compared to conventional loans.
  2. Shorter repayment periods, generally ranging from 6 to 36 months.
  3. Lower loan-to-value (LTV) ratios than conventional loans, typically ranging from 65% to 75% of the property's value.

When considering hard money loans, it’s essential for borrowers to weigh the pros and cons to determine if this financing option aligns with their specific needs and objectives.

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Disclaimer: Information, rates, and pricing are subject to change without prior notice. All loans subject to borrowers and underlying collateral meeting First Capital Trust Deeds’ and/or assigns then-current underwriting criteria. Other restrictions apply.

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