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7 Best Hard Money Lenders in Washington

Key Terms

A hard money lender is a private individual or a group of private investors who work together to provide funding for projects.
Most often, these loans are meant for rental income properties, fix and flip projects, bridge loan properties, and other types of commercial real estate.
For those looking for a short-term loan and after-repair value opportunities, hard money lenders in Washington could help you.

The state of Washington sits on the Pacific Ocean. This Pacific Northwest state is noted for its beautiful natural areas, including its rich ecological diversity. It is a stunning area to live with mountain ranges, rainforests, and a semi-arid basic in some areas. Aside from that, it is home to Seattle, one of the most modern and advanced cities in the country, and notable for being the home of many large international companies such as Amazon and Microsoft. Aside from being a tech hub, Washington has a diverse economy built on agriculture, forestry, wine, and healthcare. It is one of the wealthiest of all states. Large cities here include Seattle, Spokane, Vancouver, Everett, and Tacoma.

The high quality of life is easily matched by the high cost of living in Washington. That leads to a high value for homes of most types. Though single-family homes are common, many of the more dense urban areas, especially around Seattle, offer condos and apartment-style living that’s also very valuable. Outwards from the coast, home values fall somewhat. The median sale price of a home in Washington is currently $452,400, according to Washington State government records. In Seattle, that could easily be twice as much, whereas out in the more remote areas of the state, home values are much lower.

A key bit of information that may benefit some investors has to do with rental property. In Washington, 66.2 percent of people live in a home they own, while 33.8 percent rent their home, according to U.S. Census Bureau. That is a high percentage of rentals, and in some cases, this could create an opportunity for investors. Of those rentals, only 4 percent of them are vacant. That, too, could indicate that there is an opportunity here for those who want to buy property to rent.

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How hard money loans work

For those considering hard money loans for these properties, it can prove to be an ideal opportunity. Hard money lenders in Washington are available to provide borrowers with the financial tools they need for fix and flip rental income properties and other types of high risk real estate. Unlike conventional loans, these lenders have more flexibility to offer financing on high risk properties, but they typically do not do so unless they see the potential in it.

There are numerous factors to consider about these loans, and while they do have a higher interest rate than most other types of secured loans, that is often considered an acceptable level for the risk being taken by the lenders. If a traditional lender won’t work for you, look into a private money lender as a possible solution.

First, as with all traditional real estate loans, hard money loans in Washington are secured by the property they are used to purchase. That means the lender may be able to take foreclosure steps as a way to recoup its investment in that property if the borrower defaults on the loan. That does create some risk for the borrower as he or she would be unable to obtain the funds they put into the project. This is not uncommon for most real estate loans.

With this type of security, a lender is more likely to offer better terms to borrowers. A private money loan could offer better terms, but you’ll want to verify this in their underwriting process. Sometimes a hard money loan makes a lot of sense for construction loans if you want to build new construction on a property, as just one example. Various loans in the real estate market might not give you the funding you need with good terms, and some commercial loans are very limiting as well, leading many to turn to a hard money lender in Washington.

If you want to buy residential properties but traditional loans or rehab loans just won’t work, do your research to see if there are any competitive rates on hard money loans in your area. Private money lending could be your solution.

Also important is that hard money lenders in Washington typically offer these as short term loans that last between 1 and 5 years. Because these properties are often repaired, upgraded, and then sold again or refinanced into a more affordable loan once their value improves, they tend to remain very short term. Bridge loans, for example, allow a borrower to purchase the property with a high risk loan, wait for the completion of the build or renovations, and then refinance with a lower interest rate.

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7 Top Washington hard money lenders

Some lenders only offer hard money loans to experienced investors, while other programs can lend to those that are pursuing their first real estate investment.

1. Intrust Funding

Started by Will Heaton and James Dainard, Intrust Funding aims to provide hard money financing to the Puget Sound Region if Washington. They offer a traditional set of private money financial products, from bridge loans to fix and flip.

We contacted Intrust Funding to learn more about their private lending business and here are some of the highlights:

No appraisals or draw inspections required
Can fund loans in up to 48 hours
No prepayment penalties
Loan fees start at 2%
Terms up to 12 month
Property must be non-owner occupied
Property must be in the state of Washington