8 Best Hard Money Lenders in New Jersey

New Jersey is home to over 9.2 million people and has one of the most dense populations in the country since it only spans 8.722 square miles. The state is known for many things, including the city of Newark, which is just across the way from New York City. For those that work in New York City, living in New Jersey isn’t uncommon, especially due to the much lower home values. The state’s economy is based on several areas, including tourism, gambling, and energy resources. The area is also noted for its numerous professional sports teams.New Jersey’s proximity to New York City makes it somewhat of a commuter town for those working in the Big Apple. As a result, home prices in the area are higher than in many other states in the country. The median sale price of a home in New Jersey Is $551,028, according to the New Jersey Realtor organization.

Another key factor when considering purchasing real estate in the area is the availability and demand of rental property in the state. Some areas, such as Newark, the largest city in the state, are likely to have a higher level of rental properties than others. Statewide, 69.2% of people own their own in New Jersey, and 30.8% rent. What is specifically interesting, though, is that just 6.5% of rentals in the state are vacant. That could mean there is a significant amount of demand here that is being unmet, according to U.S. Census Bureau information.

How New Jersey hard money loans work

If you’re curious about working with private money lenders or hard money lenders in this real estate market, it’s good to educate yourself about the pros and cons. Not everyone wants or needs a traditional loan or refinance to get a perfect property for an ideal purchase price. In those cases, you need to know about alternative real estate loans and their underwriting requirements. New construction hard money loans might help you get the right property to maximize your investment opportunities. Alternative property loans are not a fit for everyone, but when you want to set up a short term or long-term rental property, a hard money loan might be better suited than trying to pre-qualify for a traditional loan. Traditional lenders just cannot offer the right kind of loan for all property types, especially it comes to an investor’s goals.

For those who wish to purchase real estate for investment reasons, the traditional mortgage loan may not be the best avenue to take. Hard money loans are those that are from individuals or companies lending directly to these borrowers. These are asset-based loans. That means that they are secured by the value of the property. Should the borrower of the loan stop making payments on it, the hard money lender has the legal right to force the foreclosure of the property. This would allow the real estate to be sold so the lender could recoup some of its investment. Most often, that does not happen. However, because these loans are often for high-risk borrowers and properties, this is a very important factor for lenders.

Typically, hard money lenders charge a bit more in interest than what is typically found in traditional mortgage loans. The higher interest rate is due, in part, due to the higher risk that lenders take on in offering these loans. Often, these lenders can provide borrowers with faster access to the funds they need to make a purchase, allowing them to close on the property sooner. This could prove important in some types of transactions.

There are many other factors to consider about New Jersey hard money loans, including that they are typically used for investment purchases. This includes fix and flip properties, rental properties meant to be held long term, and other commercial property investments. These are sometimes considered higher risk loans because of the properties themselves, but most hard money lenders will offer competitive access to qualified borrowers.

8 Top New Jersey hard money lenders

If you’re ready to learn more about the best hard money lenders lenders in New Jersey, here are the top options we’ve found through our research.

1. Asset Based Lending

Established in 2010, Asset Based Lending reports on their website that they’ve closed transactions in excess of $1.4 billion over the past decade. They lend in 24 states across the United States and offer typical private money loan programs like fix & flip, new construction, cash out refinance and rental property loans.

We contacted Asset Based Lending to learn more about their private lending business and here are some of the highlights:

• Pre-qualifications provided with 24 hours
• Loans typically close within 7-10 days
• Provides connections to local appraisers, attorneys and title agents
• 12-month interest-only bridge financing for fix and flips, new construction, cash out/refinances and rental portfolios

When you’re ready to connect with a loan officer, use our form to quickly match with eligible loan programs based on your specific circumstances.

2. West Forest Capital

West Forest Capital is based in New York but lends in the New Jersey, New York, Connecticut, Massachusetts and Florida market. They provide hard money, bridge and rental loans.

We contacted West Forest Capital to learn more about their private lending business and here are some of the highlights:

• Apartments, single family, multi-family, commercial, industrial and land properties are all eligible
• Closing can take place in less than 10 days
• Terms from 1 to 2 years available
• Can lend up to 85% of purchase price and typically cover 100% of rehab
• Total loan amount not to exceed 75% of after repair value

When you’re ready to connect with a loan officer, use our form to quickly match with eligible loan programs based on your specific circumstances.

3. Easy Street Capital

East Street Capital is based in Austin, Texas but lends nationwide except in North and South Dakota. Founded by Stephen Hagerman in 2016, Easy Street Capital has over six years of experience in the real estate investing world.

We reached out to Easy Street Capital to learn more about their hard money loans and this is what we found:

• Interest rates range from 6.9% – 10.9%
• Points range from 2-3
• There is a $1495 document fee
• No minimum credit score required
• Down payments of at least 10% required
• Renovation financing ok
• Fix and Flip loans do not typically have prepayment penalties

When you’re ready to connect with a loan officer, use our form to quickly match with eligible loan programs based on your specific circumstances.

4. EquityMax

EquityMax is based out of Florida and most of its business in the state but is able to lend throughout the United States. Founded by Brad Emmer in 1990, EquityMax has decades of experience as a hard money lender.

We reached out to EquityMax to learn more about their hard money loans and these are the key highlights that you need to know:

• Single Family Homes
• 1-4 Multi-Unit Properties
• Condos and Townhomes ok
• Commercial property and Industrial Warehouses OK
• Direct lender that has decision making over financing deals.
• Can originate loans to individuals, LLCs, corporations, land trusts and self-directed IRAs.
• No prepayment penalties
• No minimum credit score required

When you’re ready to connect with a loan officer, use our form to quickly match with eligible loan programs based on your specific circumstances.

5. Stratton Equities

Stratton Equities is a nationwide direct hard money lender for real estate investors. Founded by Michael Mikhail in 2017, Stratton Equities has over five years of experience in the private lending market.

We reached out to Stratton Equities to get more information about their hard money lending program and here are some highlights:

• Loan amounts from $100,000 up to $5 million
• Investment properties only
• Single-Family, Condos, Townhomes, Multi-Family, Commercial, Mixed-Use, Office, Retail, Industrial and Warehouse are all ok
• Up to a 75% LTV
• Rates start at 7.25%
• Interest only payments
• Loan terms are 9-24 months
• Foreign nationals are eligible
• No prepayment penalty option is available

When you’re ready to connect with a loan officer, use our form to quickly match with eligible loan programs based on your specific circumstances.

6. HouseMax Funding

HouseMax Funding is based out of Austin, Texas but has a national footprint when it comes to real estate industry lending. Started by Jeff Fetcher and Alex Morris, HouseMax provides asset-based loan financing to investors for real estate transactions.

We reached out to HouseMax to learn more about their hard money lending program and here is what we found:

• Minimum loan amount is $75,000
• Lends up to 75% of the after-repair value (APV)
• 1-3 points origination charge
• 3 months reserves required
• Direct lender that approves loans internally and funds using their own private capital.
• Lends in urban and suburban communities in all 50 states.
• Goal is to close loans in 10 days or less.
• Specializes in fix & flip loans, construction and rental loans
• Multi-family and commercial properties are ok

When you’re ready to connect with a loan officer, use our form to quickly match with eligible loan programs based on your specific circumstances.

7. Fund That Flip

Fund That Flip is a hard money lender based in New York that focuses on short term bridge loans for real estate investors looking to flip properties. Founded by Matt Rodak in 2014, Fund That Flip lends in most states.

We contacted Fund That Flip to learn more about their bridge loan program and here is what we found:

• Up to 80% LTC and 70% ARV ratios for your project
• Rates start at 9.99%
• Direct lender with discretionary capital
• Construction projects ok
• 10% down payment required

When you’re ready to connect with a loan officer, use our form to quickly match with eligible loan programs based on your specific circumstances.

8. LendSimpli

LendSimpli is a hard money lender based in Tampa, Florida. They can lend nationally in most states but may not be able to lend if the property is in a rural area. Founded by Brenden Crampton and Matthew Davies in 2018, they have nearly four years of experience in the private lending real estate investing market.

We reached out to LendSimpli to get more details about their bridge loan product and this is what we found:

• Loan amounts up to $5 million for 1-4 unit properties
• Loan amounts up to $20 million for 5+ unit properties
• Single family (1-4 units)
• Multifamily (5-20 units)
• No owner-occupied properties
• Loan terms 12-24 months
• Interest-only payments with rates starting at 8.50%
• Max LTC is 90% of project costs
• Minimum credit score is 660
• Prefer that you have at least two transactions in the past three years

When you’re ready to connect with a loan officer, use our form to quickly match with eligible loan programs based on your specific circumstances.

How are New Jersey hard money loans different from other loans?

Hard money loans differ significantly from other types of loans, including conventional loans. First, they are typically available to investors and those looking to purchase investment property. In many situations, these loans are more expensive than conventional loans, with interest rates that range from 5 to 15%. However, those rates are offset by more availability and accessibility of these loans compared to others that must follow very specific regulatory requirements. In short, they cost a bit more to some borrowers, but they are easier to obtain for higher-risk properties.

Hard money loans typically require a down payment. Often, this is 2% of the home sale price, whereas, in conventional home loans, this could be as much as 20%. The lower down payment requirements are important because it means buyers do not have to invest a lot of their personal cash reserves into the purchase of the property. The lower down payment adds a bit more risk to the lender, which again is offset by that higher interest rate.

Another difference is in the credit qualifications of borrowers. All had money lenders take credit scores into consideration before lending. However, there may be more leniency with these borrowers if they have the income and other qualifications to purchase the property. Most conventional lenders require a higher credit score.

Also, note that New Jersey hard money loans can be based on the after repair value of the home, which means the borrower may be able to borrow more than just the sale price of the home. They could use these extra funds to help with the renovation, upgrades, and other changes needed to increase the value of the property. That is not typically an option with most types of conventional mortgages, but it can be a critical factor in some home flips.

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