I recently went for a hard money loan to fund a fixer-upper project. Honestly, the process was quicker than I expected, but man, those interest rates are no joke. Anyone else feel like it's a double-edged sword?
"Honestly, the process was quicker than I expected, but man, those interest rates are no joke."
Yeah, those rates definitely sting. Did you crunch the numbers ahead of time to factor in carrying costs? I've found that hard money loans can be worth it if you have a solid exit strategy—like flipping quickly or refinancing into something cheaper. Otherwise, interest payments can really eat into your profits. Did your timeline work out as planned, or did unexpected delays make things tighter? Curious how that played out for you...
I've been there myself and learned the hard way that timelines rarely go exactly as planned. Last year, I took out a similar hard money loan thinking I'd flip the property in about three months tops. But then we hit unexpected permitting delays and contractor scheduling issues, and suddenly three months turned into six. Those extra months of interest payments seriously ate into our profit margin—ouch.
Did you run into anything like that? I agree that if your exit strategy is rock solid, these loans can be a useful tool, but it's easy to underestimate how quickly carrying costs add up when you're paying double-digit interest. Next time around, I'm definitely factoring in more cushion time for unexpected hiccups. Live and learn, right?
