Hard Money Lending Terms Defined
Ever wish there was a dictionary for real estate hard money terms? Don’t fret, we’re here to help. We’ve consolidated a list of the most commonly used terms in hard money lending to help you better understand and communicate with your hard money lender. While these are general definitions, it is important to remember that sometimes lenders will have specific definitions within loan agreements, so you’ll want to be sure to review the agreement and consult legal counsel if necessary. After Repair Value (ARV) - The value of the home after all the repairs have been completed. This is the “Sell” part of the Buy-Fix-Sell project. It is important to calculate the anticipated ARV before purchasing an investment property because often times the amount put in towards the repairs and renovations does not translate to the overall value of the property. Also, hard money lenders tend to use the ARV to help determine the maximum loan amount. Acquisition Loan - Financing for th...