Wayne is a town in Passaic County, New Jersey, located very close to Manhattan and New York City. Wayne is home to William Paterson University, a public university in Manhattan, as well as the Willowbrook Mall and a very nice wilderness area in High Mountain Park Preserve. Wayne has a population around 54,000 people, and its proximity to highways and good public transportation makes it an appealing place to invest in real estate for borrowers.
Niche ranks Wayne the best place to live in Passaic County, but also one of the best places to live in New Jersey. Wayne is a New York City suburb that gives residents a dense suburban feel and is a place where most people own their homes. There are many restaurants and bars in Wayne that give it a great night scene. Wayne is home to many young professionals and great public schools. The median home value in Wayne is $468,500, while the median rent is $1,672.
Right now, Wayne is a seller’s market. Wayne is a place where demand outpaces supply. It is a place where homes sell very fast and prices tend to be very high.
Real estate investors in the Wayne area should look into hard money loans. Hard money loans are loans mainly used for real estate transactions like fix and flips, long-term rentals, and construction projects. They’re an alternative source of financing from mortgages that give a distinct advantage: they can be approved very quickly. Hard money loans can be approved in a couple of days, whereas traditional mortgage loans can take a month or more to be approved.
Hard money loans can be approved so quickly because they don’t rely on the same asset as traditional financing. These loans are a bit more unregulated. They use the property as the asset, instead of using the credit score and financial standing of the borrower, like traditional mortgage loans. Hard money loans might require a minimum credit score of 600 to 620, but the terms and rates of the hard money loan are calculated by the after repair value of the property. New investors might need to rely on financial standing or put down bigger down payments because they have a steeper curve being approved for a loan than an experienced borrower.
Hard money loans use the property as collateral — if a borrower defaults on a hard money loan, there is no lengthy foreclosure. The lender takes on the property in a very fast and short process.
Because of this, hard money lenders have a lot of risks and cons, mainly in their very expensive rates and terms. Hard money loans have interest rates of 8–15%, which are much higher than the interest rates of traditional mortgage loans. On average, mortgages have interest rates of just over 4%, although this number has been rising recently. Hard money loans also have shorter repayment periods.
They often need to be repaid in about a year, which is much shorter than the repayment period of a mortgage, which tends to be 15 or 30 years. Lastly, hard money loans have lower LTV ratios than mortgages. They have LTV ratios around 65–75%, which are much lower than LTV ratios of mortgages, which tend to be around 80%. Hard money loans have low LTV ratios because they often require lenders to see higher buy-in in down payments.
You should only trust the best hard money lenders, which is why we at Hard Money Lenders IO have made a list of the very best hard money lenders in Wayne.