Hard Money Financing for Indiana Investors
Fast, flexible funding solutions for your real estate rehab projects
What is Hard Money Lending?
Hard money loans are short-term, asset-based financing provided by private lenders. Unlike traditional bank loans that focus on your credit score and income, hard money lenders evaluate the property's potential value and your investment strategy.
Perfect for real estate investors who need quick funding for fix-and-flip projects, Hard money loans provide the capital you need when traditional financing moves too slowly or when you have less-than-perfect credit.
Key Benefits for Indiana Investors:
- Quick Approval: Funding in days, not weeks
- Asset-Based: Focus on property value, not your credit
- Flexible Terms: Short-term loans (6-18 months)
- Higher LTV: Up to 80% of ARV financing
- No Credit Requirements: Alternative to traditional lending
Hard Money Loan Types for Indiana Investors
Fix-and-Flip Loans
Short-term financing for purchase and rehab of properties you plan to quickly sell for profit. Ideal for experienced flippers with a clear exit strategy.
Loan-to-Value: Up to 75%
Term: 6-12 months
Interest Rate: 10-14%
Bridge Loans
Temporary financing to "bridge the gap" between buying a property and securing permanent financing. Perfect for investors waiting on construction loans or traditional mortgages.
Loan-to-Value: Up to 80%
Term: 6-18 months
Interest Rate: 12-15%
Construction/Rehab Loans
Funding for major renovations and construction projects. Funds can be disbursed as work progresses, providing cash flow management for large rehab projects.
Loan-to-Value: Up to 75%
Term: 12-24 months
Interest Rate: 11-15%
Eligibility Requirements
Hard money loans are more accessible than traditional financing, but lenders still need to ensure the investment makes sense.
What Lenders Typically Look For:
- Indiana Property: Property must be located in Indiana
- ARV Potential: Clear after-repair value potential (typically 20-30% above purchase + rehab costs)
- Exit Strategy: Plan for how you'll repay the loan (sale, refinance, rental income)
- Experience: While not always required, most lenders prefer investors with track record
- Deal Structure: Realistic rehab budget and timeline
Rates and Terms
Hard money rates vary based on market conditions, property type, and lender risk assessment. Here's a general overview:
Interest Rates
10-15% Annual
Higher than traditional loans due to short terms and private lending nature
Loan-to-Value (LTV)
65-80%
Based on After Repair Value (ARV), not purchase price
Loan Terms
6-18 Months
Short-term financing designed for quick flips or bridges
Fees
2-5%
Origination fees, processing fees, and potential prepayment penalties
*Rates and terms vary by lender and deal specifics. Contact us for current market rates and personalized quotes.
Frequently Asked Questions
How quickly can I get funding?
Most hard money loans can be funded within 7-14 days of application, depending on property location and due diligence requirements. Some lenders can fund in as little as 3-5 days for qualified borrowers.
Do I need good credit for hard money loans?
No, hard money loans are asset-based, not credit-based. Lenders focus on the property's value and your investment strategy rather than your personal credit score or income.
What are the typical fees?
Expect 2-5% in origination fees, plus potential appraisal fees, title search costs, and legal fees. Some lenders charge prepayment penalties if you pay off the loan early.
Can I use hard money for any property type?
Most hard money lenders focus on single-family homes, duplexes, and small multi-family properties. Commercial properties and land development may have different requirements.
How does repayment work?
Most hard money loans require interest-only payments during the term, with the principal due at maturity. Some lenders offer interest-only options or balloon payments.
Are hard money loans legal in Indiana?
Yes, hard money lending is legal in Indiana. However, lenders must comply with state usury laws and federal regulations. Always work with licensed, reputable lenders.
What happens if I can't repay on time?
If you can't repay at maturity, you may be able to extend the loan term or refinance. However, hard money is meant for short-term financing, so having a clear exit strategy is crucial.
Can first-time investors get hard money loans?
Yes, but you may need to demonstrate investment knowledge through education, mentorship, or partnering with experienced investors. Some lenders offer programs for newer investors.
How to Apply for Hard Money Financing
Pre-Qualification
Submit basic property and deal information for initial approval
Due Diligence
Lender reviews property comps, ARV, and rehab plans
Loan Commitment
Receive loan terms and conditions
Closing
Sign documents and receive funds