Frequently Asked Questions

What is a hard money loan?

Hard money loans are a specific type of asset-based loan that are typically secured by real estate. CG Lending provides loans that are backed by non-owner occupied residential real estate or small balance commercial real estate. The majority of our fix and flip clients use the property they are purchasing for renovation and resale for the collateral on their loan.  Hard money loans are typically kept by borrowers for 6 to 18 months while they renovate the investment property and prepare it to be resold to an owner occupant buyer or rented by the landlord investor. Once the property is renovated and rented, the landlord investor will refinance the loan with a conventional mortgage and pay off the private loan, and a resale investor will pay off the loan with the sale of the property to the owner occupant buyer.

What can I use as collateral for my loan?

CG Lending will consider most 1-4 family non-owner occupied residential real estate for loan collateral. We may also consider other real property such as office buildings, apartment complexes, retail spaces, etc.

Do you charge any upfront fees?

CG Lending does not charge any upfront fees during the approval process such as an application fee. However, the borrower is responsible for third party fees such as broker price opinions (BPO’s).

What is a BPO?

BPO is an acronym for Broker Price Opinion.  BPO’s use neighborhood comparable values and in most cases a walk-through inspection of the property as part of our due diligence process.  BPO’s are much quicker and significantly less expensive that an appraisal.

Will I need to pay for an appraisal?

No, CG Lending does not require appraisals.  Instead we require a BPO (Broker Price Opinion) through our experts and in most cases a walk-through inspection of the property.  This process is much quicker and significantly less expensive than an appraisal.

Do you run a credit check?

CG Lending does not require credit checks.

Do you charge a pre-payment penalty?

CG Lending does not charge pre-payment penalties on our loans. Interest is charged during the term of the loan, with the principal due at maturity. Borrower is permitted to pay off the loan with no penalty before the term is up.

Interest rates seem high, is this typical for hard money loans?

At CG Lending we believe we provide the most competitive rates in the industry. Double-digit interest rates are typical in hard money loans with some companies charging upward of 16% interest.  CG Lending is always transparent about our rates and they are always updated and posted on our website.  The benefit of hard loans is timeliness and expediency.  Closing a hard money loan will take less than a week as compared to qualifying with a bank which will take weeks, if not months.  Savvy investors understand that hard money loans are extremely valuable in flipping properties quickly and making substantial profits.  Hard money is also beneficial in closing on a property to avoid getting bypassed for cash offers.  Our clients typically spend a small fraction of their overall profits on interest costs.