Hard Money loans are an essential part of commercial real estate financing. Investors use Hard Money loans because loans are flexible, limited documents are required, and Hard Money lenders are likely to offer terms that most banks do not. For example, banks will require an Investor to put a down payment for a particular property before the transaction is closed. This is standard practice for banks and most Hard Money lenders; however, the amount that is required for the down payment could be used as excess liquidity in case of emergency for the client.
To help our investors, GenWealth CapCo offers a $0 Down Payment product, which will allow you to purchase a property with $0 down on the down payment of the property. You only pay out of pocket for your appraisal. This product is only for Value Add/Rehab projects but if you meet the requirements, our lenders will lend 70% to 75% of the STABLIZED VALUE.
Purchase Price: $2,000,000
Rehab Costs: $400,000
Total Cost: $2,400,000
Stabilized Value: $3,450,000
At 75% of the stabilized value of $3,450,000, the maximum loan amount is $2,587,500. This amount would cover the purchase price, rehab budget, closing and carrying costs for the project. The only out of pocket fees would be for the appraisal.
In contrast, most hard money lenders and some banks may cover 100% of the rehab costs, but you have to put down 80% of the purchase price. In this scenario, instead of only paying for the appraisal with GenWealth CapCo’s lenders, you may have to pay up to $400,000 with other lenders.
For additional information about our $0 Down Payment product and how to qualify, click the Products tab. While you are there, you can check out our other products offered at GenWealth CapCo. To apply, click the Contact Us tab and fill out the application. Our lenders can issue a term sheet within 48 hours