Loading
Hard Money Loans in Downey
Downey's investor market runs on speed. Hard money loans fund fix-and-flip projects in 7-14 days, not 45.
Properties near Downey Landing and along Lakewood Boulevard move fast. Traditional financing misses these deals.
Most Downey hard money deals involve pre-1970s single-family homes needing significant renovation. Loan-to-value typically caps at 75% of after-repair value.
This loan type prioritizes the property's value over your income or credit score. Your exit strategy matters more than your W-2.
Credit score matters less than your track record. Most lenders want 640+ and proof you've completed at least one flip.
You need skin in the game. Expect 20-30% down payment plus renovation reserves.
Lenders underwrite the deal, not you. They want realistic ARV comps and a contractor's scope of work with line-item estimates.
No tax returns, no pay stubs. You bring purchase contract, renovation budget, and proof of liquidity for the project.
Not all hard money lenders operate the same. Some won't touch properties in certain Downey zip codes or project types.
Interest rates range 9-14% depending on loan-to-value and your experience. Points range 2-5% of loan amount.
Local lenders close faster but charge more. National lenders offer better rates but add underwriting layers.
Bridge lenders compete in this space with slightly lower rates but stricter qualification. Know which product fits your timeline.
The biggest mistake is underestimating renovation costs. Downey permits take 6-8 weeks, which eats holding costs at 12% annual interest.
I see borrowers compare hard money to bank rates. Wrong comparison. You're buying time and speed, not a 30-year mortgage.
Your exit matters more than your entry. Lenders want proof you can refinance or sell within 12 months.
Construction draws require inspection sign-offs. Budget for this friction. Some lenders hold 10% until project completion.
DSCR loans cost less but take 30 days to close. You lose the deal waiting for underwriting.
Bridge loans offer lower rates if you don't need renovation funding. Hard money includes construction draws built into the loan structure.
Construction loans from banks require perfect credit and extensive documentation. Hard money trades paperwork for higher cost.
Most investors use hard money for acquisition, then refinance to DSCR loans once the property cash flows.
Downey's older housing stock fits the hard money model perfectly. Most profitable flips target 1950s-1960s tract homes.
Los Angeles County transfer taxes and permit fees eat into margins. Factor $15,000-$25,000 in soft costs before you buy.
Competition from iBuyers has compressed Downey flip margins to 12-18%. Your numbers need to work at these returns.
Properties west of the 710 freeway command higher ARVs but cost more to acquire. East Downey offers better cash-on-cash returns.
7-10 days with clean title and appraisal. Most deals close in 14 days from application to funding.
25-30% down plus full renovation budget in reserves. Lenders won't fund the rehab portion upfront without liquidity proof.
Some lenders require a partner with track record or higher down payment. First-time flippers pay 1-2% more in rate.
12 months standard, with 6-month extensions available at additional cost. Plan your exit before month 10.
Not as much as banks, but 620+ opens more lender options. Below 600 limits choices and raises rates.
Mortgage financing for independent contractors and freelancers who earn 1099 income instead of traditional W-2 wages.
Mortgage programs that allow borrowers to qualify based on liquid assets rather than traditional employment income.
Non-QM loans that use 12 to 24 months of bank statements to verify income for self-employed borrowers.
Short-term financing that bridges the gap between buying a new property and selling an existing one.
Debt Service Coverage Ratio loans that qualify investors based on a rental property's income rather than personal income.
Mortgage programs designed for non-US citizens and non-permanent residents who want to purchase property in the United States.
Mortgages that allow borrowers to pay only the interest for an initial period, resulting in lower monthly payments upfront.
Financing solutions tailored for real estate investors purchasing rental properties, fix-and-flip projects, or investment portfolios.
Home loans for borrowers who have an Individual Taxpayer Identification Number instead of a Social Security number.
Adjustable rate mortgages held in a lender's portfolio rather than sold on the secondary market, offering more flexible terms.
Non-QM mortgages that use a CPA-prepared profit and loss statement to verify income for self-employed borrowers.
Home loans with interest rates that adjust periodically based on market conditions after an initial fixed-rate period.
Specialized mortgage programs designed to support homeownership in underserved communities with flexible qualification criteria.
Mortgages that meet the guidelines and loan limits set by Fannie Mae and Freddie Mac for secondary market purchase.
Financing for building a new home or making major renovations, typically converting to a permanent mortgage upon completion.
Traditional mortgage financing not backed by a government agency, offering flexible terms and competitive rates for qualified borrowers.
Innovative loan products that leverage projected home equity growth to provide favorable financing terms.
Government-insured mortgages from the Federal Housing Administration with low down payments and flexible credit requirements.
A revolving line of credit secured by your home equity that allows you to borrow funds as needed during a draw period.
A fixed-rate second mortgage that provides a lump sum of cash by borrowing against the equity built in your home.
Mortgages that exceed the conforming loan limits set by the FHFA, designed for financing high-value luxury properties.
Loans for homeowners aged 62 and older that convert home equity into cash without requiring monthly mortgage payments.
Government-backed zero down payment mortgages for eligible rural and suburban homebuyers who meet income limits.
Government-guaranteed mortgages for eligible veterans, active-duty service members, and surviving spouses with zero down payment.