Hard Money Loans vs. Soft Money Loans | When to Use Each

Hard money loans and soft money loans are common in the fix and flip area of real estate investing. While both have their clear benefits and drawbacks, they individually need to be used to fund the right type of deal. So when you’re looking at your next wholesale or off-market property, you’ll be able to finance it best to maximize your return on investment.

James Dainard from Heaton Dainard Real Estate is joined by Ashley Kehr, host of the Real Estate Rookie Podcast to talk about the key differences between these two types of real estate financing. We talk through rates for hard and soft money loans, points needed to pay, where to find these loans, and what to ask a lender.

We were also lucky enough to visit two of James’ properties, one which was purchased with hard money and one purchased with soft money. Can you guess which one used to have fifteen tenants living in it?

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Real Estate Rookie Podcast:
https://www.biggerpockets.com/real-es...
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Hard Money Loan 101:
https://www.biggerpockets.com/blog/ha...
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Check out Last Week’s Episode on How to Analyze a Flip:
   • How to Analyze a Flip in 5 Steps | Re...  
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Subscribe to ProjectRE with James Dainard:
   / @projectre  
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Follow James and Ashley on Instagram:
@jdainflips or   / jdainflips  
@wealthfromrentals or   / wealthfromrentals  

00:00 Intro
00:34 Hard Money vs. Soft Money
01:02 What is a Bridge Loan?
02:32 Average Hard Money Interest Rates
03:16 Where to Find Hard Money
04:09 Questions to Ask a Hard Money Lender
06:42 What is Soft Money?
07:52 When To Use Soft Money
09:27 Where to Find Soft Money Lenders
11:04 Get Prequalified Before!
12:07 A Hard Money House
14:18 A Soft Money House