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Hard Money Mortgage

With those that have bad credit, it can be very difficult to know where to turn when needing a bad credit mortgage.  Most lenders these days will not lend to anyone that hasn't had regular income history or credit history.  If you find yourself to be in this predicament, there is a solution, but it comes at a high price.  The loan programs that many people use when looking for a bad credit mortgage are called hard money mortgage programs. 

What exactly is a hard money mortgage?  First let's start with what "hard money" even means.  Hard in this sense means that its harder to get it, which means that interest rates are much higher and the payment is higher as well.  The main reason for this is because the lender is taking on a greater risk lending to someone without the credentials that normal lenders require in order to qualify for the prime loans out there.  When understanding what hard money mortgage loans are, many people wonder why in the world a person would ever over pay for a mortgage.  There are several reasons. 

The first reason is that self employed people automatically cannot qualify for a mortgage because they do not receive w2's in most cases.  Hard money loans may be the only way that these individuals can buy a home.  Once they are in the home for a while, they can hold out for mortgage refinancing with a prime lender once they have a few years under their belts of making consistent income.  A mortgage refinance is a very viable option for this type of situation as the self employed person usually makes enough money to handle the hard money mortgage payment. 

Another situation is someone that knows they have money coming, but cannot at the current moment provide the credentials that they need in order to get the home loan that they need. In these cases, a hard money mortgage is literally the only way that they can get into a home. Without this type of option, these people would either have to rent, or just hold out on buying a home. While this may sound easy, some circumstances make this impossible to wait. Having a hard money mortgage option is a great way for many people to still enjoy the joys of home ownership without having to miss out on the opportunity. As you can see, the situation must merit this type of loan, but when it comes to a bad credit mortgage, hard money is good option to pursue. 


  10 Steps to Home Ownership:

Step 1: Are You Ready?

Step 2: Hire a Realtor

Step 3: Get Loan Pre-approval

Step 4: Search for Homes

Step 5: Choose a Home

Step 6: Obtain a mortgage

Step 7: Make an Offer

Step 8: Insure Your Home

Step 9: Close the Deal

Step 10: Avoid Foreclosure


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