Is your hard money lender transparent with their fees and underwriting?
For an investor, having a hard money lender hit them with hidden fees or last-second changes in the loan terms can be extremely disruptive. A reputable hard money lender is completely transparent from the start about any fees the investor is responsible for, what the terms of the loan being negotiated are, and what circumstances might cause them to change.
At hard money lenders in Maryland, before any fees are paid to us, a Loan Terms Summary is generated. This document contains all of the costs involved in the loan, as well as a breakdown of the loan terms that both parties have agreed on. If a hard money lender refuses to operate in a similarly transparent manner, it could be an indication that they are noncommittal or preparing to change the terms down the line.
Does your lender care if you make money?
The unfortunate truth is that not every deal is a winner, and the right hard money lending partner should care about you making money – not just them. Your lender’s Loan Officers and Underwriters should be honest with you about the profitability of a deal and the likelihood of your coming away in the black. We’ve taken it a step further, and built a hard money loan calculator to help our borrowers estimate and visualize the true profitability of a deal before they take the risk.