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» Equity in Your Project
Posted on 10/21/2004
"I can get a home mortgage for 100% of the purchase price. Why can't I get a hard money loan for 100% of the purchase price?"
The answer lies in the kind of loan you are looking for. Owning a home is part of the "American Dream". Our government wants us to own homes, put down roots, become 'stable' citizens. These concepts were set in place many years ago, when physical stability was equated with social stability. Residential mortgages enjoy a special status with underwriting, government support (residential mortgage interest is deductible on your taxes), etc.
Hard money loans for are for commercial/investment purposes. Count on being required to have a minimum of 20% of the cost of the real estate in your own funds or other collateralized real estate at risk in a commercial real estate deal – even if you are buying residential properties.
Posted in Miscellaneous
The answer lies in the kind of loan you are looking for. Owning a home is part of the "American Dream". Our government wants us to own homes, put down roots, become 'stable' citizens. These concepts were set in place many years ago, when physical stability was equated with social stability. Residential mortgages enjoy a special status with underwriting, government support (residential mortgage interest is deductible on your taxes), etc.
Hard money loans for are for commercial/investment purposes. Count on being required to have a minimum of 20% of the cost of the real estate in your own funds or other collateralized real estate at risk in a commercial real estate deal – even if you are buying residential properties.
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