When someone is looking for a hard money loan, one of the most common questions is: “Will my target real estate purchase qualify or attract interest from a hard money lender?” This is an important and valid question that deserves a detailed answer.

To be clear, a hard money loan can be secured for virtually any real estate transaction. For example, you could secure a loan for the purchase of a single-family home, multi-family residential property, commercial real estate, etc. However, it is worth noting that the vast majority of hard money loans in Los Angeles and elsewhere are issued as mortgages for the purchase of residential property.

fix and flip

One of the most popular real estate transactions financed through hard money loans are fix-and-turn projects. Loans are typically used to purchase residential property for the specific purpose of updating the home and then putting it back on the market for a profit.

Unique properties will present challenges

It can be difficult to find a reputable hard money lender who is willing and able to make a loan for other types of property, such as:

• Land purchases;

• Industrial property (for example, steel mill);

• Churches;

• Restaurants

A good rule of thumb is that the more unique the property, the more difficult it will be to find a reputable and respected lender who is willing to provide a loan for the purchase. Because? Because most lenders are generally interested in supporting properties that will sell more easily. This helps ensure that the lender recovers its funds as quickly as possible, even if the borrower suddenly decides to withdraw from the project or is unable to make loan payments.

Hard money loans for estate sales

Although it’s harder to find a reputable lender for more exclusive real estate transactions, it’s worth noting that if you’ve identified a property on the market that is selling through an estate sale, you might be able to get a loan in Los Angeles and in other places. with fewer hurdles compared to, say, buying a restaurant. This is because some hard money lenders may also make loans while an estate is going through the probate process. This is an important service as, in many cases, surviving heirs may need to borrow funds to pay off outstanding debts and obligations that have been attached to the estate of a deceased loved one. Hard money lenders can provide a loan secured by real estate that is going through probate. It is important to highlight the fact that traditional lenders, such as credit unions or banks, do not normally offer this type of assistance.

Do you want to apply for a hard money loan in Los Angeles or any major city in Southern California? You have options and you need to take action as soon as possible.