Hard money loans are a form of private money financing that is used to purchase property that may not conform to conventional underwriting standards. Funds for hard money loans generally come from private individuals or from mortgage pool funds run by fund managers that raise capital from multiple individuals.
Hard money lenders are able to approve and fund a loan much more quickly than traditional lenders such as banks. They do not require as much documentation because they are primarily concerned about the value of the real estate being used as collateral versus the credit and income of the borrower. Hard money loans often provide more leverage than conventional loans, allowing borrowers to rely less on their own or outside investors’ capital.
Hard money loans are offered for a variety of investment purposes including:
- Fix and flip loans which allow you to acquire, renovate and sell assets;
- Bridge loans which help you close quickly on time sensitive investment loans;
- Cash out loans which allow you to refinance property you already own in order to obtain capital for another purpose;
- Construction loans whereby a borrower may be able to finance a portion of the site acquisition and much or all of the construction cost.
First and foremost, choose a lender that is experienced with the type of loan that is being requested. The lender should understand the collateral and strategy and be able to structure a deal that offers you the opportunity to have a profitable outcome. A good hard money lender can often add value to the investment decisions that you must make. Next, verify that your lender has the capacity to make the loan and the capability of executing in the time frame required. Finally make sure that your lender has a reputation of integrity and conducts its business with honesty and transparency.
We lend on single family homes, multi-family properties, commercial, retail, land and other special uses.
Currently we are lending in the major markets of Texas including Dallas, Fort Worth, Houston, Austin, San Antonio, Corpus Christi and the Rio Grande Valley. Bay Mountain Capital is also lending in Atlanta, Georgia. Smaller Texas markets and other major markets in the U.S. are possible on a case by case basis.
No. We loan to borrowers that have many different financial circumstances. Your credit score will help us to determine how we might structure your loan and what interest rate you will be charged.
Yes. Bay Mountain Capital loans to both full time real estate entrepreneurs as well employed individuals who are seeking to supplement their income
Yes, we can accept almost every type of legal entity as a borrower. The principle manager or managers will be required to personally guarantee the loan if there is an entity borrower.
We do not; however, our loans are generally at least $50,000 and less than $5,000,000.
Follow the Apply link on the Bay Mountain Capital website. Please fill out the application completely. The application will only take a few minutes. Someone from Bay Mountain Capital will contact you quickly, usually within the same day.
No, applying is free. After you submit your application and provide us with the necessary information, we will send you preliminary loan estimates. If you decide to move forward, then you will need to pay a deposit to cover any expenses we may incur in connection with underwriting your loan, including the fee associated with an appraisal.
Yes, we require an appraisal which will value the property subject to the rehab or construction budget. This appraisal can be a valuable tool when you either sell the property or refinance into a long term loan.
This depends on how quickly we receive all of the necessary information about the property, the borrower and the deposit for underwriting expenses. Usually once we have the appraisal back, if title is clear we can close within a matter of days. Generally the process takes two to three weeks from application to close.
In addition to the online loan application we will need:
- An executed purchase contract if the loan request is for an acquisition;
- A detailed scope of work and cost estimates for any rehab or construction work;
- If you are borrowing through an entity, we will need formation documents and an operating agreement for the entity;
- Tax returns for the previous two years;
- Other limited information specific to your transaction.
Typically, our loans are for a term of 6-12 months with possible extensions available subject to Bay Mountain Capital approval. Interest rates generally start at 12% and there will be loan fees of 2-4% of the loan amount. You will also have to pay the cost of any third party reports such as a feasibility analysis or appraisal if required.
Yes. At a minimum the property will be inspected by the appraiser during the appraisal process.
We service our loans here at Bay Mountain Capital in our Dallas office. Our pledge is that you will be treated courteously and your loan will be serviced with accuracy and professionalism.
Yes, we require monthly payments. Typically those are interest only payments plus a tax escrow payment.
We will order an inspection of the property to determine how much of the scheduled work has been completed. Generally, this inspection will be performed by the same professional that originally performed the feasibility inspection prior to the closing of the loan. Once we receive this report, we process your draw and fund the eligible amount to you by your choice of check, ACH or wire transfer.
In most cases we are able to extend your loan for periods of six month each.
Absolutely! We pay for referrals – please check out our Referrals information.
Just email our loan servicing department at email@example.com and we will provide you, your mortgage professional or your title company with a payoff statement, usually within one business day.
Our business is built on repeat customers. As long as you have the experience and financial capability of handling multiple properties, we would like to be your lending partner!
You guys have been just wonderful to work with. And I am not just blowing smoke. a little feedback here coming from a guy who has been a broker for decades and dealt with many hard money lenders - I don’t believe I have run across such efficiency where everyone is proactive with emails, everyone is copied on emails, the follow up is there, and the speed is there. Just really impressed. It’s been so smooth. I look forward to doing more deals with you all.
I appreciate all that your team at Bay Mountain has done for me and your attentiveness always proves to be ‘above and beyond’!
I would like to mention that I have had a great experience with Wayne Corley and Angie Arrington. They have been very cordial, professional and extremely helpful. I also want to mention that the new system for proof of funds letters is a great system and makes things easier for everyone.