Hard Money Lenders Atlanta: Your Guide to Fast Financing
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Kelsey Morrison Former HomeLight EditorClose
Kelsey Morrison Former HomeLight EditorKelsey Morrison worked as an editor for HomeLight's Resource Centers. She has seven years of editorial experience in the real estate and lifestyle spaces. She previously worked as a commerce editor for World of Good Brands (eHow.com and Cuteness.com) and as an associate editor for Livabl.com. Kelsey holds a bachelor’s degree in Journalism from Concordia University in Montreal, Quebec, and lives in a small mountain town in Southern California.
Are you seeking financing options for your next real estate project in Atlanta? Whether you’re eyeing a fixer-upper in Howell Station or planning to expand your rental portfolio in Buckhead, hard money lenders in Atlanta can offer the flexibility and quick funding you need. Hard money loans are an alternative to conventional financing — ideal for those with tight timelines, limited capital, or less-than-perfect credit.
For non-investors looking to buy a new home before selling their current one, we’ll also explore other creative ways to leverage your current home’s equity. By the end, you’ll be equipped with the knowledge to choose the financing method that best fits your real estate goals.
Start Making Offers Without Waiting to Sell Your Home
Through our Buy Before You Sell program, HomeLight can help you unlock a portion of your equity upfront to put toward your next home. You can then make a strong offer on your next home with no home sale contingency.
Editor’s note: This post is for educational purposes and is not intended to be construed as financial advice. HomeLight always encourages you to consult your own advisor.
What is a hard money lender?
A hard money lender is a private individual or company that offers short-term loans secured by real estate. Unlike traditional lenders, hard money lenders consider the value of the property used as collateral over the borrower’s creditworthiness. Their services are popular among real estate investors, such as house flippers and those purchasing rental properties, who need quick access to funds and flexible terms.
Hard money lenders use the after-repair value (ARV) — the estimated value of a property post-renovation — to determine loan amounts. They typically lend a percentage of the ARV to safeguard their investment.
Interest rates for hard money loans are higher, ranging from 8% to 15%, with additional fees like origination charges and points. If a borrower fails to repay, the lender can seize the property to recover their investment.
How does a hard money loan work?
If you’re considering a financing option that combines speed and flexibility for your real estate investments, connecting with hard money lenders in Atlanta could be a smart move. Here’s a quick overview of how hard money loans work:
- Short-term loan: These loans typically have a repayment period of 6–24 months, unlike the 15- or 30-year terms of conventional mortgages.
- Faster funding option: When time is of the essence, hard money loans can be approved within days, in contrast to the 30 to 50 days typical for mortgage loans.
- Less focus on creditworthiness: Approval relies less on your credit score and income history, focusing more on the property’s value.
- More focus on property value: These loans are based on the loan-to-value ratio of the property used as collateral.
- Not traditional lenders: Hard money loans are usually provided by individual investors or private lending companies, not traditional banks.
- Loan denial option: Ideal for those with poor credit who have been denied a mortgage but possess significant home equity.
- Higher interest rates: These loans come with higher interest rates due to the increased risk for lenders.
- Might require larger down payments: Borrowers may need to provide a larger down payment, sometimes up to 20%–30%, depending on the property’s value and loan specifics.
- More flexibility: With fewer regulations, hard money lenders can set flexible criteria for credit scores and debt-to-income ratios, and loans can help avoid foreclosure.
- Potential for interest-only payments: Unlike traditional mortgages, hard money loans may allow for interest-only or deferred payments initially.
What are hard money loans used for?
Hard money loans cater to specific financing needs in the Atlanta real estate market. They are often sought by investors who need quick funding or face difficulties with traditional bank loans. Let’s explore the common uses of hard money loans:
Flipping a house: For flipping homes in Atlanta, hard money loans provide fast access to cash for purchasing and renovating properties. These quick-turnaround loans help investors acquire homes, complete necessary renovations, and resell them for a profit.
Buying an investment rental property: Investors aiming to purchase rental properties can utilize hard money loans to quickly acquire and refurbish properties. This allows landlords to make essential repairs and start generating rental income faster than with traditional financing.
Purchasing commercial real estate: Hard money loans are useful for buying commercial properties because they offer flexibility and quick closings. When time is of the essence, these loans help investors quickly secure valuable properties.
Borrowers who can’t qualify for traditional loans: Individuals with significant home equity but poor credit often turn to hard money lenders. These loans are approved based more on the property’s value than the borrower’s credit score, offering a viable financing alternative.
Homeowners facing foreclosure: Homeowners on the brink of foreclosure may use hard money loans to refinance their debts or gain time to sell their property. This can provide a temporary solution to avoid losing their home or damaging their credit further.
How much do hard money loans cost?
The cost of hard money loans is generally higher due to the increased risk for lenders and the convenience of faster funding. Here are some typical costs:
- Interest rates: These can range from 8% to 15% or more, based on the lender’s risk assessment.
- Origination fees: Lenders may charge 1% to 5% of the loan amount as an origination fee.
- Closing costs: Additional fees at closing can include legal fees, appraisal fees, and other administrative costs.
- Points: Lenders might charge points, a percentage of the loan amount, upfront.
You can use online calculators to estimate these costs.
Alternatives to working with hard money lenders
If you’re a homeowner looking to leverage your current home’s equity, here are a few alternatives to hard money loans to consider:
Take out a second mortgage: A home equity loan or home equity line of credit (HELOC) can provide the funds you need, often at a lower interest rate compared to a hard money loan.
Cash-out refinance: This option allows you to refinance your existing property, pulling out cash to finance new investments. It usually comes with lower interest rates than hard money loans.
Borrow from family or friends: Personal loans from family or friends can offer flexible repayment terms and potentially lower or no interest rates, making this a more affordable option.
Use a government-backed loan program: Programs from the FHA, VA, or USDA can help you purchase homes with lower down payments and reduced interest rates.
Peer-to-peer loans: These loans are provided by individual investors through lending platforms, functioning similarly to hard money loans but often with different terms.
Specialized loan programs: Look into specialized loans for fixer-uppers or refinancing if you already have a hard money loan and want to replace it.
Request a seller financing option: In some cases, sellers may agree to finance the purchase themselves, which can lead to lower closing costs and less stringent eligibility requirements.
How to buy before you sell
Sometimes, the perfect listing appears when you least expect it. Whether it’s a charming bungalow in West End or a sleek condo in Midtown, you want to act fast. If you’re an Atlanta homeowner aiming to buy a new home before selling your current one, HomeLight offers a seamless solution with the Buy Before You Sell program.
The Buy Before You Sell (BBYS) program lets you use the equity in your current home to make a strong, non-contingent offer on a new property. If your home qualifies, you can get your equity unlock amount approved in 24 hours or less, with no upfront costs or commitment. This allows you to purchase your new home confidently and sell your existing one vacant, avoiding the hassle and expense of moving twice.
Here’s how HomeLight Buy Before You Sell works:
There is a flat fee of 2.4% of your current home’s sold price. However, the savings in other areas, like moving expenses, temporary housing, and possibly the purchase price of your new home, could outweigh the cost. Additionally, HomeLight’s BBYS fees are generally lower than bridge loan interest rates, which currently range from 9.5% to 12%.
3 top hard money lenders in Atlanta
Traditional lenders aren’t always the best fit for every real estate investment. If you need to move quickly and seize an opportunity, check out these top-rated hard money lenders in Atlanta.
Hard Money Loans Georgia
Georgia Private Loans, also known as Hard Money Loans Georgia, is a direct lender based in Atlanta that specializes in short-term loans secured by real estate. Loans can be underwritten in 24 hours and funded within days. Amounts range from $20,000 to $5 million, and they charge a 16% interest rate per annum (interest only). Georgia Private Loans only lends money for real estate projects or refinances in the State of Georgia.
Lending clientele: Non-owner occupied residential real estate and commercial real estate
Loan criteria: Up to 65% LTV with a 25%–50% down payment if purchasing a property
Hard Money Loans Georgia boasts a 5-star rating on Google based on over 20 reviews. Previous clients praise owner Sam for his quick turnaround times, competitive rates, and professionalism. “[Sam] was easy to reach, considerate of the situation, and very personable in his approach,” wrote one reviewer. “In a matter of days, I was at the closing table and able to move forward with life and my business.”
404-229-8004
Fairview Commercial Lending
Fairview Commercial Lending operates a handful of regional hard money lending companies, including Georgia Hard Money, which is headquartered in Marietta. They have been lending since 1975 and fund hard money loans and bridge loans on both residential (investment purposes only) and commercial properties. Closing can happen in five to ten days, or even faster if you’re in a hurry.
Lending clientele: Residential and commercial real estate investors
Loan criteria: Up to 50%–55% LTV
Fairview Commercial Lending has a 4.9-star rating on Google. They are also accredited by the Better Business Bureau (BBB) and hold an A+ rating. Clients praise the company for their smooth transactions, quick closings, and honest answers. “Fairview lending was such a pleasure to work with, Glen and his team are so efficient, professional, and friendly from first contact to signing escrow,” reads a recent review.
404-846-4718
Locklin Capital
Locklin Capital is a hard money and private lending firm based in Woodstock. Founded in 2018, the company serves new and seasoned investors alike. Their primary loan products include fix-and-flip and bridge, new construction, DSCR purchase or refinance, and conventional purchase or refinance. Closing on short-term loans takes just a few days, and costs typically range from 2% to 5% of the loan amount.
Lending clientele: Residential and commercial real estate investors, plus homeowners
Loan criteria: Up to 75% ARV (fix-and-flip), up to 70% ARV (new construction), up to 80% LTV (DSCR), up to 95% LTV (conventional)
Locklin Capital has a perfect 5-star rating on Google. Clients praise them for being knowledgeable, communicative, and reliable. “They’ve got lending options for almost every situation, their communication is top-notch, and most importantly, they CARE about advising their investors and delivering results, which is rare nowadays,” wrote a former client.
770-250-2051
Investing in real estate?
Hire an investor-friendly real estate agent who can help you get access to off-market properties at a discount and assess potential rental income based on market trends. HomeLight can connect you with investment property specialists at no cost.
Should I partner with a hard money lender in Atlanta?
Deciding whether an Atlanta hard money loan is right for you depends on your specific situation and real estate investment objectives. Hard money loans are particularly useful for real estate investors who need quick access to funds or have projects requiring fast turnarounds. If you can manage the higher costs and shorter repayment terms, a hard money loan might be the perfect solution for your next investment opportunity.
For Atlanta homeowners wanting to leverage their home’s equity without dealing with high interest rates, HomeLight’s Buy Before You Sell program offers an excellent alternative. This program allows you to make a competitive offer on a new home while paying a small flat fee, simplifying the process and reducing the stress of moving.
As with any major financial decision, it’s important to consider your long-term strategy and consult with a financial advisor to ensure it aligns with your overall investment goals. If you’re looking to connect with investor-friendly real estate agents in Atlanta who have access to trusted hard money lenders, let HomeLight introduce you to top professionals in your area.
Header Image Source: (ibuki Tsubo/ Unsplash)
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