When you take out a hard money loan – particularly if you’re a new REI – you’ll hear quite a bit of terminology. You may already be familiar with some of it, especially if you’ve taken out traditional loans before. However, some of the terms used in the hard money lending industry are different from those used in traditional lending.
The Hard Money Loan Glossary
An appraisal is a statement of value on a piece of property. It’s put together by a credentialed expert who determines value based on condition, age and demand.
An assignment is a written document that transfers an interest from one person to another. Typically, this document transfers an interest other than real property.
A clear title is one that doesn’t have any defects or encumberances. A defective title can allow someone else to make a claim to property that you own.
A contingency in an agreement depends on action or inaction on behalf of one of the parties involved in a real estate transaction.
A deed is a written document that transfers ownership of a property from one party to another.
Deed of Trust
A deed of trust is an instrument that allows the legal title to a piece of property to be used as security for a loan.
Due on Sale Clause
A due on sale clause is typically a provision in a deed of trust that asks for the loan to paid off when the property is sold or transferred.
Escrow is the holding of the documents and funds involved in a real estate transaction until the closing process is complete.
First Trust Deed
A first trust deed is a lien on property that supersedes any other lien.
A lien is a claim against property.
Do You Need a Hard Money Loan in Atlanta?
If you need to take out a hard money loan in Atlanta or any of the surrounding communities, Paces Funding is here for you.