Understanding the basics of hard money land loans in California is the first step of breaking down real estate financing. After all, hard money loans are the best friend of any real estate investor. They’re the quickest route to securing a deal. Nevertheless, hard money financing can get complex very quickly, so you have to understand what you’re getting into prior to making any decisions for yourself.

Here are a few important facts you need to know about hard money lending.

What’s hard money lending?

Hard money loans are private loans funded by private lenders or individuals as opposed to government controlled financial institutions. A hard money loan is an asset-backed loan where a borrower can get financing secured by most types of real estate, including raw land.

Why don't many private lenders consider land?

Private lenders always have to take into account the worst case scenario while assessing a possible loan funding. That worst case scenario is having to foreclose & own the subject property.

“While most lenders don’t offer loans on land, we do provide funding for land loans in California. We have access to both institutional and private funds and can assist with your land loan request on both large and small acreage, as well as both unimproved and improved lands” said a spokesperson for ACA Lending.

Why is hard money the most popular land loan option?

Hard money financing allows you to skip conventional lenders & borrow money based on the collateral value of the real estate. People with bad credit scores or those who’re labelled as high-risk borrowers may bind hard money financing to be the only alternative. Though they are more expensive compared to conventional loans, they give more flexible terms, quick delivery of cash, and higher approval possibilities.

What is a hard money loan for raw land?

A hard money loan for raw land is simply a loan secured by that land.  If the loan to value is 50% or below, likely you can obtain a hard money loan for your transaction.

What is a hard money loan for Residential/Subdivision Development?

This is meant for developing more than one single family residence or buying land to develop into multiple residences. Some examples include raw land, entitled land, entitled land, vacant land, paper lots, etc.

About the company:

All California Lending is a private lending company that specializes in hard money lending and commercial loans. They can help with Hard Money Land Loans California as well. Please visit more here - https://www.acalending.com/land-loans/