Hard money lending for 2024 are expected to remain rather consistent even as we move into 2025. Most hard money loans ranging from 2 months to 36 months will have a rate of 12-19%. You can expect most hard money lenders to charge additional points on the loan and those points and extra fees will vary for each specific situation. It’s important to negotiate and get a better rate and fee with your lender, but you also want to focus on the points charged upfront. In some cases, we’re seeing private money lenders charge points that are around 5% of the entire loan amount.

 

Hard Money Lending Rates For 2024

We continue to see hard money lending rates remain somewhat steady even though traditional mortgage rates have ticked up a bit. Rates overall are still at longtime lows and we remain confident that things will be somewhat consistent through the summer. Other factors to consider when looking at expected hard money rates for 2022 include where you live and the overall value of your property in terms of dollars and what it can produce in revenue.

 

Shop Around For the Best Hard Money Rates

Some private money lenders work a little differently than others. They may give a rate Without an appraisal and instead of getting paid for the appraisal right away, they may be paid a flat fee or a certain percentage of the selling price. Many will refund a percentage of money paid into escrow and a point that pays for an early escrow release. This will increase the property’s value and may make the lender more likely to lend at your specified rates. Although not ideal, it may work for you. Review both private and hard money quotes and put the requirements together. Make sure to get at least 3-4 different quotes and then play each option against each other. By shopping around you can squeeze a few extra points off your final loan terms and that amount of savings can be significant in the long run.

 

Longterm Forecast For Hard Money Lending Rates

The long-range indicators for private lending rates will all depend on how the economy recovers from the current pandemic. Of course the real estate and mortgage market has been strong for the past few years. But as we know from past recessions, the real estate market can turn very quickly and you will see rates go up before you know it. That’s why it’s important to lock in your hard money rate as quickly as you can and even push for quicker loan funding. Another factor is inflation. As the Federal Reserve continues to inject trillions of dollars into the economy we should continue to see interest rates stay steady or possibly increase in the early part of 2025. This monetary increase will have benefits in the short term as people spend more money and enrich the overall economy. But the increased spending could have serious consequences in the long run as more liquidity can often lead to inflation. An increase in inflation will cause the Fed to increase interest rates and we’ll see a matching increase in mortgage rates and hard money lending rates.