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Many online hard money loan calculators are available to help estimate these costs.
Alternatives to working with hard money lenders
If you’re a homeowner looking for alternatives to hard money loans, here are some options to consider:
Take out a second mortgage: A home equity loan or home equity line of credit (HELOC) allows you to tap into your home’s equity at typically lower interest rates than hard money loans.
Cash-out refinance your home: This option lets you refinance your existing property and pull out cash to finance a new investment, often with lower interest rates than hard money loans.
Borrow from family or friends: Personal loans from family or friends can offer more flexible repayment terms and potentially lower or no interest rates, making them a cost-effective alternative.
Use a government-backed loan program: Programs from the FHA, VA, or USDA assist in purchasing homes with lower down payments and reduced interest rates.
Consider peer-to-peer loans: Loans from individual investors through platforms like LendingClub or Prosper offer an alternative to traditional hard money loans with different terms.
Explore specialized loan programs: Consider loans tailored for fixer-uppers or refinancing investment properties if you have an existing hard money loan and want to replace it.
Request a seller financing option: Some sellers may agree to finance the purchase themselves, offering lower closing costs and more lenient eligibility requirements.
How to buy before you sell
Sometimes, the perfect listing appears when you’re least expecting it. Perhaps it’s a charming bungalow in Montrose or a sleek, high-rise condo in Midtown. If you’re a Houston homeowner looking to buy a new home before selling your current one, HomeLight offers an innovative solution that simplifies the process.
The Buy Before You Sell (BBYS) program allows you to leverage your existing home’s equity to make a stronger, non-contingent offer on a new property. If your home qualifies, you can get your equity unlock amount approved within 24 hours, with no cost or commitment required. Once approved, you can purchase your next home confidently and then sell your current one vacant, avoiding the hassle of moving twice.
Here’s how HomeLight Buy Before You Sell works:
While BBYS comes with a flat fee based on your current home’s sold price, the potential savings in other areas might outweigh this cost. You could save on moving expenses and temporary housing, and possibly fetch a higher sale price for your home. Additionally, HomeLight’s BBYS fees are typically much lower than the interest rates on bridge loans, which range from 9.5% to 12%.
3 top hard money lenders in Houston
If you’re looking for fast, flexible financing in Houston, hard money lenders can be a game-changer. They’re especially useful for investors or anyone needing quick access to cash without the hassle of traditional loans. Here are three top hard money lenders in Houston to consider.
