The extended recession in the US has left many homeowners remain in a position where they cannot  patch up their mortgage. As these homeowners look for a good way to keep their  properties many come across the term hard money loan. The natural idea is to think that a hard money loan could possibly allow you to refinance your home and keep it.

Hard Money have a misconception of being regarded loans for people with poor credit, or personal loans when you just need cash. Those kinds of loans do exist; there are not appropriate hard money loans.

A hard money loan is typically a short-term loan, secured by real estate having MASSIVE equity. Primarily investors that are  acquiring   the property  to rehab it and resell it use them. Where as  it is  not possible to use them to stop foreclosure it is highly unlikely that a hard money lender could have a loan for that goal.

To obtain the hard money loan you will have to have a solid exit approach. You must be able to assure the hard money lender unquestionably that you will be able to pay back the loan upon the maturity date. Exactly what is your exit technique? Additionally, you will need a great deal of equity in your home, 35% or maybe more is usually, what they want to  look at.  To think about  a  refinance  to stop foreclosure then they may want even more equity.

Therefore, is it ever an efficient choice?

If you are behind on payments and dealing with foreclosure, and also have the equity a hard money lender would  demand  then sell your home. The resource of cash from the sell will have a tremendous affect on your personal finances and peace of mind. If it is your main goal, and you have a possible client set up then a hard money loan can be a suitable option for you to stop  foreclosure and  acquire   to settlement with your buyer. As regards to using a hard money loan  to prevent foreclosure and decide to keep your home it isn’t impossible although not regarded by most to be a suitable option.