What is a private money loan?
A private money loan is a transaction that is originated by a mortgage lender utilizing their own funds or funds from private individuals, as opposed to institutional funds that are utilized in a traditional transaction. Private money loans generally do not carry traditional qualifying guidelines, but are subject to all typical state usury and banking laws.

When is private money used?
Private money loans are utilized by individuals, developers and investors when traditional lending sources aren't available or when the borrowing scenario is outside of traditional guidelines. Especially in the current economic climate, funds aren't as readily available for qualified borrowers and principles with profitable projects that are in need of financing. Private money fills these gaps in the capital markets and provides funding for these borrowers.

Is private money the same thing as hard money?
The terms hard money and private money are often used interchangeably. However, private lenders or hard money lenders all have different lending philosophies and guidelines and will be more appropriate for different lending scenarios as a result. As a private lender, MMG will originate hard money loans, but we will also explore opportunities to joint venture, provide equity financing or acquire distressed paper or real estate.

How do I know if a private money loan is right for me?
Submitting a loan scenario to MMG is simple. We can generally let you know whether your scenario has a good chance of being funded within a few hours of receiving your executive summary. Visit our Submit a Loan page or call us at  (310) 295-1121  to speak to a member of our lending staff.

Do you need to verify income and check credit?
Generally speaking, we don't. We are an asset-based lender and what's most important to us is the underlying value of the asset(s) that we're lending on and the probability of repayment of the loan. The stronger the collateral provided for the loan, the more likely we are to make a positive funding decision.

How expensive is private money?
The cost of the loan is relative to the risk involved in the transaction. However, our Standard Terms and Pricing are a good representation of what a borrower can expect to pay.

How long does it take to fund a loan?
MMG Capital can fund a loan is as little as 5 days with a complete loan package. However, funding times will vary widely depending upon the complexity of the loan and the availability of funds at the time of loan submittal. On average, it will take between two to four weeks to fully fund a loan request.

What fees are involved?
Almost all of the fees that are associated with the loan are covered by the loan points that are charged by MMG Capital at closing. However, there will still be escrow, title, attorney and broker fees in some cases. For most scenarios, these fees do not constitute a significant expense.

Do you charge up-front fees?
No, we absolutely do not charge any up-front fees like many hard money lenders do. Borrowers will be required to pay all transaction costs, but no monies are paid to MMG Capital prior to closing.

Can the fees be financed?
Yes, all fees can generally be financed. However, there will be a small out-of-pocket expense required to begin processing your loan that will come in the form of a third party attorney fee. MMG Capital does not collect any monies prior to loan closing. These fees are all fully refundable in the event that your loan is not funded by MMG Capital.

Is an appraisal of the property required?
No, an appraisal is not always required. Appraisals that were done in the past 120 days will generally suffice and will be subject to review by our own appraisal staff. In other instances, no appraisal is required at all.

What do you mean by additional collateral?
MMG Capital is one of California's most flexible private money lenders. Even in scenarios where the equity in a property isn't sufficient collateral for a loan, we will explore additional options with our borrowers. In these situations, we will ask for additional forms of collateral that include: other real estate owned, stocks, bonds, cash, cash-value life insurance, annuties, etc.

Is it legal to cross-collateralize real estate?
Absolutely. While some question the legitimacy of cross-collateralization, it is a common practice that is even used by commercial banking institutions for simple transactions like car loans. In today's mortgage lending environment, it's becoming even more popular given the growing need for capital amidst a tight lending environment. Cross-collateralization allows us to make loans to qualified borrowers quickly and on flexible terms.