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A Brief Explanation of Hard Money Lending

The elderly are increasingly opting for private lending as an investment choice. Many who are fed up with speculating on the stock market, investing in often artificially valuable products, are seeking the most secure investment. 

Real estate-backed assets can be a fantastic alternative to security issues because the loans made towards real estate owners are typically supported by real estate, they are able to make money even in the event of a catastrophe.

You can also get real estate hard money lending services via TaylorMade Lending

Using Hard Money Loans for Real Estate Investments

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Typically, these financiers are usually interested in becoming passive investors. They're those with a huge amount of cash and do not have the time or interest in investing in real estate on their own instead, they invest in real estate investors. 

By providing credit to property investors that are not able to obtain conventional loans, private lenders get the highest rates of return, often as high as 15%, based on the "riskiness" of the creditor.

A very used and widely used term in lending with hard money is LTV or the ratio of loan to value. The loan-to-value ratio in the field of hard money financing is what percentage of the worth of the home they're willing to loan to the lender. 

For instance, if you have an LTV of 60 percent, the lender would only lend 60% of the value that the property is worth if the buyer decides to sell the property. This is a great scenario when it comes to investors who are planning to renovate an existing property.