Hard Money Lender in New Rochelle, NY

Hard money lenders serve as non-bank, asset-based financing sources. While both banks and hard money lenders provide mortgage loans, their lending standards are not the same. Banks look closely at the borrower’s credit history and income, while hard money lenders concentrate on the value of the property as security for the loan. This difference allows hard money lenders to complete underwriting in just a few days, often funding within a week, compared to the months it can take a bank.

Real estate investors, especially those buying properties at foreclosure auctions, frequently choose private money lenders to ensure fast closings. Because auctions demand immediate payment, hard money financing is often the only solution. These loans are also useful for properties that need renovation work or lack a Certificate of Occupancy. In fast-paced real estate markets such as New Rochelle, hard money loans are considered a vital tool for staying competitive.

At West Forest Capital, we specialize in transactions that banks refuse. We also work with clients who have poor or recovering credit, since a low FICO score will not block financing. Alongside purchase loans, we also provide refinancing and cash-out options to give investors the flexibility and agility needed to act quickly.

Compared with traditional bank loans, hard money loans are much easier and faster to obtain, which explains why they carry higher interest rates. These rates are generally between 10 and 12 percent, plus an additional two points collected at closing. The term is usually short, lasting either one or two years, and loans can be divided into two separate parts.

1. Funds for the purchase, typically cover 70 to 85% of the purchase price.
2. Funds for rehab, if necessary, which may cover up to 100% of the renovation costs.

In projects that involve rehab, the funds for that portion are given in arrears, meaning after part of the work has already been completed. As an example, if $50,000 is allocated toward rehab, the borrower may first complete $15,000 in work and then apply for $15,000 of the rehab funding. This continues until the budget is fully disbursed.

Hard money loans are most commonly used as bridge loans, fix and flip loans, or loans for commercial properties. Their structure ensures that the combined purchase price and rehab money do not exceed 65 percent of the property’s ARV. They are well-suited for investment properties where access to capital must be quick in order to close deals competitively.

At West Forest Capital, we provide hard money loans that function as commercial loans, which means we lend to LLCs rather than directly to individuals. If you have not yet formed an LLC, there is no need for concern, because establishing one is quick and straightforward, and it can be created with only one member, which can be you.

When evaluating an opportunity, our team reviews both the purchase price of the property and its ARV, which is its After Repair Value, in order to ensure that the investment makes sense. Properties that are acquired either below market value or at market value are the ones that typically qualify most effectively, particularly when renovation funds are also part of the request. In such cases, we expect the renovation plan to be well-organized and finished according to schedule. Additionally, a clean title is required for funding, so any judgments or liens related to the property or to the LLC must be cleared before disbursement.

Our purpose is to make our borrowers successful. Like many seasoned hard money lenders, we want every real estate investment we finance to be profitable. We verify that each deal provides enough margin to account for purchase costs, renovation expenses, loan interest, closing costs, and all other obligations, while still leaving room for profit. That is the principle behind how we underwrite loans.

If you are an investor working in New Rochelle or managing a time-sensitive deal, West Forest Capital provides the speed and expertise that allows you to move efficiently.

A hard money loan is most often turned to in the following types of cases:

• To purchase and fix a property that banks refuse to finance because of either borrower credit issues or property problems. Once the repairs are finished, the property can be sold to a retail buyer. This method is called fix and flip.
  
• To purchase and renovate a property that banks decline to finance and then rent it out. When the property has stable tenants, it becomes eligible for refinancing through a traditional bank at lower rates.
  
• To buy real estate under time-sensitive conditions where a bank cannot meet the deadline, such as foreclosure auctions. Hard money lenders may fund the deal in a week, while banks might take several months.
  
• To gain fast access to cash through refinancing by using property already owned as collateral.
  
• To arrange a quick refinance when an existing loan is due to expire.
  
  

To finance a buyout of a relative or business partner, with the option to refinance into longer term debt once ownership is consolidated.