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Use online hard money loan calculators to estimate these costs.
Alternatives to working with hard money lenders
If you’re a homeowner looking for alternatives to hard money loans, here are a few options to consider:
Take out a second mortgage: If you have substantial equity in your home, a home equity loan or home equity line of credit (HELOC) can provide the needed funds at a lower interest rate compared to a hard money loan.
Cash-out refinance your home: This option allows you to refinance an existing property, pulling out cash to finance your new investment. It often comes with lower interest rates than hard money loans.
Borrow from family or friends: A personal loan from family or friends can offer flexible repayment terms and potentially lower or no interest rates, making it a more affordable option.
Use a government-backed loan program: Programs offered by the FHA, VA, or USDA can help buyers purchase homes with lower down payments and reduced interest rates.
Consider peer-to-peer loans: These loans are provided by individual investors through lending platforms like Funding Circle. They function similarly to hard money loans but often have different terms.
Explore specialized loan programs: If you already have a hard money loan and want to replace it, consider specialized loans for fixer-uppers or investment property refinancing.
Request a seller financing option: In some cases, sellers may agree to finance the purchase themselves, which can result in lower closing costs and less stringent eligibility requirements.
How to buy before you sell
Sometimes the perfect home hits the market when you least expect it. Perhaps it’s a spacious townhouse in Culver City or an industrial loft in DTLA. For Los Angeles homeowners aiming to buy a new home before selling their current one, HomeLight offers a seamless solution.
The Buy Before You Sell (BBYS) program allows you to tap into your existing home’s equity to make a strong, non-contingent offer on a new property. If eligible, you can get your equity unlock amount approved within 24 hours without any upfront costs or obligations. This approval allows you to purchase your next home confidently and sell your current home vacant, eliminating the stress and hassle of moving twice.
Here’s how HomeLight Buy Before You Sell works:
While the BBYS program has a flat fee based on your current home’s sale price, the potential savings in other areas might outweigh this cost. You could save on moving expenses, temporary housing, and possibly even the purchase price of your new home. Additionally, HomeLight’s BBYS fees are generally much lower than bridge loan interest rates, which range from 9.5% to 12%.
3 top hard money lenders in Los Angeles
Finding the right hard money lender in Los Angeles can make or break your deal, especially with how fast the market moves. To help you out, here are three lenders investors in the area trust for quick, flexible financing. Each one has a solid track record, competitive terms, and experience with the unique pace of Los Angeles real estate:
