Tag Archive for: #Hard Money Mike

Top 5 Questions to Ask Hard Money Lenders

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Today we are going to discuss the top 5 questions to ask hard money lenders before you get a loan. Not all hard money lenders are the same. That’s why asking the right questions before you sign is key. Whether you’re doing a flip, a BRRRR, or a bridge loan, these five questions can save you time, stress, and a whole lot of money.

1. What Are Your Total Costs?

Don’t just look at the interest rate. Lenders can make their deals sound great by hiding extra fees.

👉 Some charge low interest, like 10%, but add in:

  • 2 points (That’s 2% of the loan upfront!)

  • $1,000 in processing fees

Let’s break that down:

  • Loan Amount: $200,000

  • 2 Points: $4,000

  • Six Months of Interest at 10%: $10,000

  • Processing Fee: $1,000

  • Total: $15,000

Now compare it to another lender:

  • Interest Rate: 12%

  • No Points

  • But $4,000 in other fees

  • Six Months of Interest at 12%: $12,000

  • Total: $16,000

👉 Even with no points, the second lender costs more.

💡 Use a tool like the Loan Cost Optimizer at hardmoneymike.com to compare lenders side-by-side.

2. How Do You Decide Loan Amounts?

Lenders calculate what they’ll lend based on different values. Some use just the purchase price, others use ARV (After Repair Value).

Let’s look at two examples:

  • Purchase Price: $150,000

  • Rehab Costs: $50,000

  • ARV: $300,000

One lender might only give you 75% of the purchase price, or about $112,500.

Another lender might lend based on ARV, offering:

  • 90% of the purchase = $135,000

  • 100% of the rehab = $50,000

  • Total Loan: $185,000

👉 That’s a huge difference. Ask if they use purchase price or ARV to calculate your loan.

3. How Do You Decide Property Value?

This one’s big. Some lenders use real appraisers. Others use in-house tools or AI. The problem? They can value your property way lower than what it’s actually worth.

Example:

  • One lender values the ARV at $300,000

  • Another comes in at just $250,000

If they lend up to 75%, here’s what you’d get:

  • $300,000 ARV: Loan up to $225,000

  • $250,000 ARV: Loan up to $187,500

👉 That’s almost a $40,000 difference in your funding!

Always ask:

  • Who determines value?

  • Can I provide my own comps?

  • Can I dispute a low value?

4. Are There Prepayment Penalties?

Some lenders sneak in rules like:

  • Minimum interest guarantees

  • 3, 6, or 9-month required interest payments

Even if you pay the loan off early, you’re stuck paying interest for those months.

👉 Ask about any minimum interest periods. Make sure the loan fits your timeline.

5. How Do Draws Work?

If you’re doing a flip or a BRRRR, you’ll likely have rehab money held in escrow.

For example:

  • Rehab budget: $50,000

  • That money is held until work is done

  • You’ll get it back in draws (aka stages)

Ask:

  • How fast can I get my draw?

  • Are there fees every time I request one?

  • Do I need an inspection or lien waivers?

👉 If your contractor can’t get paid, they might walk off the job. That’s the last thing you want.

Final Thoughts

These five questions can help you find the best lender for your project:

  1. What are the total costs?

  2. How is the loan amount calculated?

  3. How do you come up with property value?

  4. Are there prepayment penalties?

  5. How do your draws and escrow work?

✨ Want help comparing lenders? Try the Loan Cost Optimizer at HardMoneyMike.com.

Watch our most recent video to find out more about: Top 5 Questions to Ask Hard Money Lenders BEFORE You Get a Loan

What’s Better for You: Hard Money or a Partnership?

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Today we are going to discuss what’s better for you: hard money or a partnership. Every investor runs into this question sooner or later:
Should I use hard money or bring in a partner?

Let’s break it down so you can choose what fits your deal best.

First, What’s Hard Money?

Hard money is a loan based on the property — not your personal income.
You borrow from a lender and pay interest, but you keep full control of the project.

Pros of Hard Money:

  • Fast funding. Many loans close in just a few days, which can give you an edge.

  • No partner needed. That means you get to keep 100% of the profits.

  • Flexible terms. It works well for flips or short-term projects.

Cons of Hard Money:

  • Higher rates. You’ll pay more than you would with a traditional loan.

  • Short terms. So, you’ll need to finish fast or refinance quickly.

  • More risk. If the deal goes sideways, you’re the one responsible.

Example:
Let’s say you find a flip that needs $200,000.
A hard money lender gives you $160,000 (80% of purchase), and you put in $40,000.
You make monthly interest payments. Then, when you sell the property, you keep all the profit.
In this case, hard money gave you speed, control, and full profit — but it also came with risk.

On the Other Hand, What About a Partnership?

A partnership means you team up with someone else.
Usually, they bring the money, while you bring the hustle.

Pros of a Partnership:

  • No loan required. You don’t need to qualify or make payments.

  • Shared risk. If things go wrong, you won’t shoulder it all alone.

  • Build strong connections. A great partner today could help with 10 deals tomorrow.

Cons of a Partnership:

  • Split profits. Often, you’ll walk away with only 50% — or sometimes even less.

  • Less control. You’ll need to agree on decisions, which can slow things down.

  • More communication. You’ll need to share updates and work closely together.

Example:
Let’s say that same $200,000 flip comes up.
Your partner funds the whole thing, including repairs. You do the work.
Then, you split the profits 50/50.
This works great if you don’t have the funds, but you’re willing to trade profit for opportunity.

So, Which Is Better?

Well, that depends on what you need the most.

Choose Hard Money If:

  • You want full control of your deal

  • You have the down payment and monthly payments covered

  • You believe in the deal and want to keep all the profit

Choose a Partnership If:

  • You don’t have enough cash or credit

  • You’re new and want to lower your risk

  • You’re okay sharing profits in exchange for experience

A Quick Comparison

To help you decide faster, here’s a side-by-side look:

Feature Hard Money Partnership
Profit Share 100% yours Shared
Control All yours Shared decisions
Risk All yours Shared
Cost Monthly payments No loan payments
Speed Very fast funding Depends on partner
Experience Needed Some required Can be new

Final Thoughts

At the end of the day, there’s no wrong choice — only the right fit for your deal.
Some investors use hard money to scale fast. Others build long-term success with great partners.
In fact, many smart investors use both, depending on the deal.

So before you jump in, think about your goals:
Do you want control, or would you rather share the load?
Do you have money for payments, or would a partner give you the boost you need?

Whatever you choose, take action.
Deals don’t wait, and neither should you.

Need help deciding?
We can walk you through it, run the numbers, and help you pick the smartest path forward.
Reach out today — your next deal could be one good decision away.

Contact Us Today! 

Is hard money or a partnership better for you? Contact us today to find out more!

Free Tools For You! 

We also have free tools available! Download the Loan Optimizer to compare financing options side by side!  

Learn more!

Visit our YouTube channel to learn more about real estate investing and how you can get on the fast track to success

5 Tips to Get Approved by Hard Money Lenders Fast!

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Today we are going to discuss the 5 tips to get approved by hard money lenders fast! Hard money loans are a great option for real estate investors who need fast funding for unique deals. Unlike traditional bank loans, hard money lenders focus on the property and exit strategy rather than personal income or credit scores. Let’s take a closer look!

1. Have a Clear Exit Strategy

Hard money lenders want to know how you plan to pay back the loan. Whether it’s flipping the property, refinancing into a long-term loan, or selling part of the land, your exit strategy must make sense.

Example: If you’re flipping a house, explain how long renovations will take and what comparable homes in the area are selling for. Show that you have a solid plan to sell quickly and at a profit.

2. Keep the Loan Term Short

Hard money loans are meant to be short-term solutions, usually between 9 to 12 months. The faster you can complete your project and pay off the loan, the better your chances of approval.

Example: If you’re subdividing land, outline a timeline for approvals, sales, and closing. A clear plan reassures lenders that they’ll get their money back quickly.

3. Show Responsible Credit Habits

Hard money lenders don’t care about your credit score, but they do look at your credit history. If you have a pattern of late payments, bankruptcies, or foreclosures, it may raise concerns.

Tip: If your score is low due to high credit usage but you always pay on time, highlight that to the lender. They’re more interested in your payment habits than the number itself.

4. Keep Your Loan-to-Value (LTV) Low

Most hard money lenders prefer an LTV under 75%. For fix-and-flip deals, they typically lend up to 75% of the After-Repair Value (ARV). The lower the risk to the lender, the faster they’ll approve your loan.

Example: If you’re purchasing a $200,000 property expected to be worth $300,000 after repairs, a hard money lender may lend you up to $225,000 (75% of ARV).

5. Move Quickly and Be Prepared

Hard money lenders work fast, but they expect you to move just as quickly. Have all required documents ready, including property details, a project timeline, and any additional funding sources.

Tip: Work with a lender who understands your local market. A lender familiar with your area can approve deals faster because they know the risks and opportunities.

Final Thoughts

Hard money loans can be a game-changer for real estate investors who need fast, flexible funding. By following these “5 Tips to Get Approved by Hard Money Lenders Fast”, you’ll increase your chances of securing the funds you need without delays.

If you’re ready to compare rates, try our Loan Cost Optimizer to find the best hard money loan for your next project! Contact us today!

Watch our most recent video to find out more!

Why Renovation Speed is the Key to Your Success

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Today we are going to discuss why renovation speed is the key to your success. Renovating a property can make or break your success as an investor. The key? Speed. The longer a project takes, the more it costs. However, when you move quickly and efficiently, you keep more money in your pocket and get to the next deal faster. Let’s break down why speed matters and how it can boost your profits.

Time is Money

Every extra day of renovation costs you. Loan interest, utility bills, as well as property taxes keep adding up. The longer your project drags on, the smaller your profits become.

Fast Renovations Mean Faster Profits

Let’s compare two investors:

  • Investor A flips a house in three months and moves on to the next deal.
  • Investor B takes six months, paying twice the holding costs.

Who do you think makes more money? The faster you finish, the faster you profit.

Rentals Need Speed Too

If a rental sits empty, it’s losing money. A one-month delay means missing an entire month of rent. Fast renovations get tenants in sooner, putting cash in your pocket.

Speed Without Sacrificing Quality

Fast doesn’t mean sloppy. It means having a solid plan, hiring the right team, and keeping things on schedule. Delays kill deals, but efficiency builds wealth.

Conclusion

If you want to maximize your real estate success, focus on speed. Whether flipping or renting, a fast, well-planned renovation means lower costs, quicker profits, and more deals in the future. Don’t let delays eat into your success—keep things moving and watch your investments grow!

Contact Us Today! 

Do you have more questions about what makes an investment property a good investment? Contact us today to find out more! 

Free Tools For You! 

We also have free tools available! Download the Quick Deal Analyzer to see if your potential property will be a good investment.

Learn more!

Visit our YouTube channel to learn more about real estate investing and how you can get on the fast track to success! 

What Makes an Investment Property a Good Investment?

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Today we are going to discuss what makes an investment property a good investment. Not all investment properties are good investments. Some make money, and others drain your wallet. The key is knowing what to look for before you buy.

1. Cash Flow

A good investment property pays you every month. If your rental income covers the mortgage, taxes, insurance, and maintenance—with money left over—you have positive cash flow.

Example: Sarah buys a rental for $150,000. Her mortgage, taxes, and insurance total $1,000 per month. Her rent is $1,400. After setting aside $200 for maintenance, she still clears $200 per month in profit. That’s a good deal!

2. Property Value Growth

Over time, a solid investment property increases in value. Buying in a growing area with strong demand means you can sell later for a profit.

Example: Jake buys a duplex in a neighborhood where new businesses are popping up. Five years later, property values have jumped 30%. Now, he has options—sell for a profit or refinance to buy more rentals.

3. The Right Financing

Your loan matters. A high-interest rate or bad terms can turn a great property into a bad investment. The right financing keeps your payments low and cash flow strong.

It isn’t just about location, it’s about numbers. If the deal makes money today and builds wealth for tomorrow, you’re on the right track.

Contact Us Today! 

Do you have more questions about what makes an investment property a good investment? Contact us today to find out more! 

Free Tools For You! 

We also have free tools available! Download the Quick Deal Analyzer to see if your on the right track! 

Learn more!

Visit our YouTube channel to learn more about real estate investing and how you can get on the fast track to success! 

Stacking Your Funding Options can Guarantee Profits

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Today we are going to discuss how stacking your funding options can guarantee profits! Smart investors don’t rely on just one type of funding. They stack their options to create the best deal possible. By combining different funding sources, you can lower costs, increase cash flow, and keep more profit in your pocket.

Let’s say you find a great fixer-upper for $100,000. A hard money loan covers 80%, but you still need $20,000 for the down payment. Instead of using your own cash, you could tap into a HELOC, a 0% interest credit card, or even a private lender. This way, you spread out your costs and keep more cash available for renovations.

Another example? A rental property with a DSCR loan. You might finance 75% of the purchase price with a DSCR loan and cover the rest with a seller carryback or a line of credit. This lets you close deals without draining your bank account.

Stacking funding isn’t about taking on more debt, it’s about using the right debt at the right time. The goal is to build wealth while keeping your cash flow strong.

In the full article, we’ll break down different ways to combine funding sources, so you can structure deals that work for you.

Contact Us Today! 

Find out more about how stacking your funding options can guarantee profits!  Contact us today to find out more about real estate investment loans!

Free Tools For You! 

We also have free tools available! Download the Loan Optimizer to compare financing options side by side!  

Learn more!

Visit our YouTube channel to learn more about real estate investing and how you can get on the fast track to success! 

Fix & Flip Like a Pro: Hard Money Strategies for Maximum Profits

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Today we are going to discuss how to fix & flip like a pro: hard money strategies for maximum profits. Flipping homes is one of the fastest ways to build wealth in real estate. But without the right funding, your project can stall before it even begins. That’s where hard money loans come in. They offer fast, flexible financing that can cover up to 100% of your deal (in the right conditions).

In this guide, we’ll break down the key numbers, loan terms, as well as roadblocks that can make or break your success. Plus, you’ll get access to a free Excel spreadsheet to help you run your numbers before making a move.

Step 1: Know Your Key Numbers

Lenders evaluate fix and flip deals using three key numbers:

1. Purchase Price

  • This is what you’re paying for the property.
  • Example: $200,000

2. Rehab Budget (Scope of Work)

  • This includes repairs, upgrades, and improvements.
  • Example: $50,000

3. After Repair Value (ARV)

  • This is the projected value after renovations.
  • Example: $350,000

💡 Pro Tip: Your lender will use the ARV to determine how much they can lend. Most lenders offer loans up to 75% of the ARV.

Step 2: Understanding Your Loan Amount

Lenders will calculate your loan based on the ARV, purchase price, and rehab costs.

  1. Maximum Loan Amount (75% of ARV)

    • $350,000 × 75% = $262,500
    • This is the highest loan amount a lender might offer.

  2. How Much You Actually Get

    • Lenders will not give more than the total of your purchase price + rehab.
    • In this example:
      • Purchase + Rehab = $250,000
      • Since $250,000 is less than the $262,500 max loan, you could qualify for full coverage.

✅ Result: If your numbers align, you may be able to secure 100% financing. If not, you’ll need additional funds.

Step 3: What Costs Do You Need to Cover?

Even with hard money financing, you’ll have out-of-pocket costs. Here’s what you should prepare for:

1. Down Payment

  • Lenders typically fund 80–90% of the purchase price.
  • You may need to bring 10–20% of the purchase price in cash.
  • Example: $200,000 purchase price × 20% down = $40,000 out-of-pocket.

2. Rehab Cost Contribution

  • Many lenders fund 80–100% of rehab costs, but you must pay upfront and get reimbursed.
  • Example: $50,000 rehab × 90% lender coverage = $5,000 out-of-pocket.

3. Closing Costs & Loan Fees

  • Loan origination, title fees, and processing costs typically range from 2-4% of the loan.
  • Example: $205,000 loan × 3% closing costs = $6,150.

4. Carry Costs (Holding Expenses)

  • Monthly interest-only payments on the loan.
  • Taxes, insurance, utilities while holding the property.
  • Example: $205,000 loan at 10% interest = $1,700/month.

💡 Pro Tip: Many first-time investors underestimate how much cash they need upfront. Make sure to plan for these costs before diving into a deal.

Step 4: The Biggest Roadblocks & How to Overcome Them

Even great deals can fail if you don’t have the right funding strategy. Here’s what commonly trips up new investors:

❌ Not Having Enough Upfront Capital

✅ Solution: Build your Money Bucket with personal savings, business credit lines, or HELOCs.

❌ Not Understanding Escrow Releases

✅ Solution: Hard money lenders hold rehab funds in escrow and release them in stages. Make sure you can cover materials and labor upfront before reimbursement.

❌ Underestimating Holding Costs

✅ Solution: Budget for at least 4–6 months of carrying costs (interest, taxes, insurance).

💡 Avoid These Issues by Running Your Numbers First!

Step 5: Get Your Deal Funded the Right Way

Hard money loans are powerful tools when used correctly. The key is knowing your numbers, planning ahead, and ensuring you have enough funding to complete the project.

✅ Grab Your FREE Fix & Flip Calculator that is featured in this video that discusses fix & flip like a pro: hard money strategies for maximum profits. 

This tool will help you:
First, Calculate your loan amount
Second, See your cash needed upfront
Finally, Estimate your monthly payments

Got questions about fix and flip loans? Contact us today! Let’s make sure your next flip is your most profitable one yet! 🚀

Need More Funding?

Visit HardMoneyMike.com for more expert advice on real estate loans, BRRRR strategies, as well as funding solutions.

What closing costs should you expect when buying a property?

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Today we are going to answer the question “what closing costs should you expect when buying a property?” Buying a property is exciting, but there’s one piece that often catches buyers off guard: closing costs. These are the fees and expenses you’ll pay to finalize your home purchase. Knowing how to calculate these costs upfront can save you from surprises and help you budget better.

Closing costs typically range from 2% to 5% of the purchase price. For example, if you’re buying a $200,000 home, you can expect to pay between $4,000 and $10,000 in closing fees. But what exactly makes up these costs?

Here are some common items included:

  • Lender fees: These cover things like loan origination and underwriting.
  • Title services: Fees for title searches and insurance to make sure the property is free of legal issues.
  • Appraisal: The cost of determining the property’s value.
  • Taxes and prepaid costs: Property taxes and homeowners insurance may need to be paid upfront.

It’s important to ask your lender for a Loan Estimate, which breaks down these expenses before closing. This document gives you a clear picture of what you’re paying for and ensures there are no hidden fees.

By understanding closing costs, you can prepare for your purchase with confidence. Ready to dive deeper? The full guide explains how to estimate your costs and even save money on them.

Contact Us Today! 

Is the potential property right for you? Contact us today to find out more about what closing costs should you expect when buying a property.

Free Tools For You! 

We also have free tools available! Download the Quick Deal Analyzer to see if your potential property will be a good investment.

Learn more!

Visit our YouTube channel to learn more about real estate investing and how you can get on the fast track to success! 

Fix and Flip Investment Properties

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Today we are going to discuss fix and flip investment properties. Are you ready to turn neglected properties into profitable investments? Fix-and-flip projects can be one of the most exciting ways to grow wealth in real estate. The process is simple to understand: find a property with potential, renovate it, and sell it for a profit. But to succeed, you’ll need the right plan and funding to keep everything moving smoothly.

For example, imagine buying a home for $150,000 that just needs some cosmetic updates. After spending $30,000 on repairs like new floors, paint, and landscaping, you sell it for $220,000. That’s a $40,000 profit! However, to make this happen, you’ll need to know how to budget for purchase costs, repairs, and holding expenses.

Timing also matters. The faster you can finish a project, the quicker you can get it sold and move on to the next deal. This means having reliable contractors, staying on top of schedules, and making smart financial decisions—like securing funding upfront to avoid delays.

Fix and flip projects are great for those who enjoy creative problem-solving and hands-on work. If you’re organized and ready to take action, these investments can offer fast returns.

Stay tuned as we dive deeper into what it takes to succeed in fix-and-flip investing, from finding properties to picking the right financing options. With the right strategy, you can turn run-down properties into opportunities.

Contact Us Today! 

Are Fix and Flip investment properties right for you? Contact us today to find out more! 

Free Tools For You! 

We also have free tools available! Download the Quick Deal Analyzer to see if your potential property will be a good investment.

Learn more!

Visit our YouTube channel to learn more about real estate investing and how you can get on the fast track to success! 

Hard Money vs. Traditional Loans

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Today we are going to discuss hard money vs. traditional loans. When it comes to real estate, picking the right type of loan can make or break a deal. Two common options are hard money loans and traditional loans, but they’re as different as night and day. Let’s break it down.

Hard money loans

Hard money loans are short-term loans that are all about speed and flexibility. They’re funded by private lenders who care more about the property’s value than your credit score or income. Need to close fast on a fixer-upper? A hard money loan might be your best bet. These loans usually come with higher interest rates and shorter repayment periods, making them great for quick projects like flips.

Traditional loans

On the other hand, traditional loans, think mortgages from banks or credit unions, focus on you as the borrower. They’ll dive deep into your credit, income, and debt before approval. These loans take longer to close but often come with lower interest rates and longer terms. Traditional loans are perfect for long-term investments, like rental properties you want to hold onto for years.

Example:

Here’s a quick example: If you’re flipping a house and need money within a week, a hard money loan could save the day. But if you’re buying a rental property to build wealth over time, a traditional loan might be the smarter move.

Each loan type has its place. The key is matching the loan to your goals. Ready to dive deeper? Let’s explore how to choose the right one for your next deal.

Contact Us Today! 

Which is best for your next investment need, Hard money vs. traditional loans? Contact us today to find out more!

Free Tools For You! 

We also have free tools available! Download the Loan Optimizer to compare financing options side by side!  

Learn more!

Visit our YouTube channel to learn more about real estate investing and how you can get on the fast track to success!