Greenwood is a city of Indiana just under 60,000 that has been experiencing rapid population growth in the last decade. It is located in Johnson County, and it is considered the most populous suburb in the southern part of the Indianapolis Metropolitan Area.
Overall, Greenwood is also the fourth largest suburb in Indianapolis. It has great schools and very affordable neighborhoods. It is considered one of the best places to live in Indiana, being a home to many young professionals and families while also having a lot of green space. The median home value of Greenwood is $155,300, while the median rent is $982. Most people in Greenwood own their homes.
Is Greenwood currently a seller’s market, which means demand is outpacing supply in the city. Houses are selling for much more expensive prices than listing price and homes are closing fast.
Hard money loans might be the answer to real estate investing in Greenwood. Hard money loans are otherwise known as last resort loans or bridge loans, but they are mainly use for real estate transactions. Hard money loans have a huge advantage of being approved quickly, especially compared to traditional mortgage loans. They can be approved within a couple of days, as opposed to mortgages, which can take more or less a month to be approved.
The reason hard money loans can be approved so quickly is because they’re not based on the credit score of the borrower or other aspects of financial standing. Instead, hard money loans are based on the after repair value of the property. They still require minimum credit scores of 600 to 620, but hard money lenders use the property as the asset or collateral for a loan.
If a borrower defaults on a mortgage, the bank forecloses on the property and has to undergo lengthy and costly judicial proceedings. If a borrower defaults on a hard money loan, the lender takes on the property, which can result in significant profit for the lender, but can also result in significant loss.
As a result, hard money loans are incredibly risky for both the borrower and the lender. They have interest rates of 8–15%, which are significantly higher than the interest rates of mortgages. They also have much shorter repayment periods of more or less a year, which are much shorter than repayment periods of mortgages which can go up to 30 years. Hard money loans also have low LTV ratios compared to traditional mortgage loans, which means the borrower has to put down a bigger down payment than they do with traditional loans.
It’s important not to trust any hard money lender. Not every hard money lender is trustworthy, and some hard money lenders might tack on unnecessary fees. Other hard money lenders are not the most transparent with having to add on underwriting fees, closing costs, and origination fees. For new investors, hard money loans might be hard to get since most hard money lenders require a successful investing history.
At Hard Money Lenders IO, we have you covered in finding the best hard money lenders in Greenwood. Look no further for a good financing partner for your real estate journey.
