Borrower shakes hands with a lender after a refinance with a hard money loan.

Do you want to refinance on a property but don’t want to go through a traditional lender? You have options, and refinancing with a hard money loan could be a good choice for leveraging the equity in your current properties.

What Is A Hard Money Loan?

A hard money loan is a popular funding choice for real estate investors because it uses a tangible asset, the property, for security. Instead of being funded by a bank, they’re funded by an individual, or collective of individuals, who specialize in funding real estate transactions.

Hard money funding is different from traditional lending from a bank in that the decision to fund a borrower is weighed more against the property and its income potential and not as much against the borrower’s current financial status. Hard money loans also carry higher rates, and borrowers are well-advised to check their numbers before borrowing to ensure their project makes good economic sense.

That said, many successful real estate investors use hard money loans almost exclusively to build their portfolios and wealth. It’s important to note that even though your real estate asset plays a significant role in a hard money lender’s decision to fund you, it’s always wise to stack the odds in your favor by having your financial house in order.

When Should I Refinance My Property?

Ideal times to refinance your property with a hard money loan include:

  • When your property has acquired a significant amount of equity.
  • When your financial goals for refinancing are attainable with the potentially higher rate of a hard money loan.
  • When you have a real estate investment opportunity and need financial backing quickly.

When Should I Wait To Refinance My Property?

There are times we advise waiting or deferring to traditional lending to refinance your property with a hard money loan, including:

  • Projects not related to real estate
  • Trying to skip a monthly payment
  • Wanting to make non-asset related purchases, such as a car, vacation, or shopping trip.
  • When the numbers don’t add up

Why Use A Hard Money Loan For A Refinance?

Hard money loans traditionally carry higher rates. However, when the numbers make sense, refinancing with a hard money loan is an excellent option in multiple scenarios.

If You’ve Been Declined By Traditional Lenders

Some lenders will only lend if you have a certain amount of properties. If you’re refinancing from an asset in your growing real estate portfolio, traditional lenders might see your assets as a liability. At HouseMax, your growing portfolio shows us that you’re a rock star that knows what they’re doing and that we can trust our money with you.

When You Have A Project That Needs Funding Fast

Someone in your network has tipped you off that there’s an opportunity to buy a cash-flow property. You crunch the numbers, they make sense, the property fits well into your investment strategy, and you want to move fast. Hard money refinancing helps you tap into another property’s equity quickly, so you can make a move.

When You’re A New Real Estate Investor

You may have a primary residence with enough equity to finance your dreams of entering the world of real estate investing. However, you might be self-employed, have a negative mark on your credit report, or have another circumstance that doesn’t make you an ideal bank borrower.  This can be frustrating and keeps many people from ever experiencing the rewards of real estate investing. Hard money lenders like HouseMax Funding work with people like you to secure your needed funding. That way, you can get off the sidelines and into
the game.

How To Refinance With A Hard Money Loan

You can always contact our office if you have any questions on how to get started, but you’ll find with a bit of preparation, refinancing with a hard money loan is simpler than you might think.

Prepare Your Documents

Gather all relevant documentation, including:

  • Any purchasing agreement for your investment property
  • Mortgage information for the home you’d like to refinance
  • Any renovation plans and numbers for the investment property
  • The last 60 days of bank statements and paystubs
  • A government ID

Contact A Hard Money Lender

Every hard money lender is different, and at HouseMax Funding we are passionate about helping good people finance fantastic deals. Contact us today to explore options.

Communicate Consistently And Often

Once you’ve started the application process, green-light all texts, calls, and emails from your lender and respond to what they need quickly. 

Get Funded

Now for the fun part: check your bank account. Once everything goes through, your funds are wired, and you’re free to start your next project!

Getting Started With A Hard Money Loan Refinance

Call HouseMax Funding today to start your refinance with a hard money loan. We help beginners, and experienced investors leverage their assets to grow their real estate portfolios and wealth. We look forward to speaking with you!

Contact us today.