A private money lender is any non-bank company such as Groundfloor that lends money to people to buy real estate properties.
Groundﬂoor is a ﬁrst-of-its-kind investment platform for everyday investors that gives both non-accredited and accredited investors direct access to short-term, high yield returns backed by real estate. Our returns are powered by venture loans to real estate entrepreneurs, originated and serviced by Groundﬂoor.
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We finance projects of all sizes all across the country!
Groundﬂoor offers several ﬁnancing options to help you maximize your ﬂip. Our simple solutions offer as much as 90% financing, including our renovation budget. These short-term financial instruments allow investors to purchase properties with plans for immediate profit through cosmetic renovations or complete reconstruction work on an existing structure, which can lead them toward greater returns down the line!
Real estate rehabs present an exciting opportunity for investors to increase their profits and expand their portfolios. By investing in properties that require renovations, savvy real estate moguls can quickly turn a small investment into substantial returns over the course of weeks or months – making it one of the most popular strategies amongst industry veterans!
With Groundfloor, home builders have access to a revolutionary new way of financing their new construction project homes. Unlike more traditional construction loans—which can require large down payments along with variable interest rates and often complex terms—Groundfloor offers an innovative alternative that makes the process easier than ever before!
Check out some of the properties that we've helped transform all across the country.
Learn more about a few of the borrowers that have worked with Groundfloor to turn bring their project to life!
Here are some of the questions we get asked the most.
Private money lenders are non-institutional individuals or companies that provide short-term loans to borrowers for a variety of purposes. Working with a private money lender can offer several benefits, such as faster access to funds, more flexible loan terms, and a simplified application process.
Speed is one of the primary advantages of working with a private money lender. Unlike traditional lenders, private lenders can often provide funds in a matter of days rather than weeks or months. Private lenders typically have more flexibility in their loan terms too.
Another benefit of working with a private money lender is the simplified application process. Traditional lenders typically require extensive documentation and review processes that can be time-consuming and onerous. Private lenders, on the other hand, often base their lending decisions on the value of the collateral or the borrower’s ability to repay the loan rather than on strict credit score requirements.
You may repay your Groundfloor loan at any time. There is a three-month minimum interest required for prepayments within the first three months of your loan. After three months, there is no prepayment penalty.
Loans go into conditional approval, pending the borrower’s acceptance of Groundfloor terms and conditions. At the closing table, Groundfloor will provide the initial disbursement of funds. Once the property has been purchased and the project begins, borrowers receive draws payouts in the form of draw requests from a Groundfloor-held escrow account. Please note that draws are approved based on completed work. For a more detailed explanation of a loan’s lifecycle, please refer to our blog post on the subject.
Once you submit a loan application to Groundfloor, a Groundfloor representative will contact you to get more details about your project and discuss terms. Then, the loan moves through processing, wherein you submit all required documentation to your assigned Groundfloor representative. Once this is completed, the loan moves into the underwriting stage before being cleared to close. You will receive communications and updates about the status of your loan from the Groundfloor team, but you are always welcome to reach out to your dedicated Business Development Manager should you have any questions along the way.
Our Operations Team can typically close a loan application within 10-14 business days. We will advise upon review whether the application is complete, or if we need additional information to complete the application.
Groundfloor generally charges borrowers between 2.75% and 4% of the principal amount of the loan in interest for underwriting the loan. Borrowers’ points and fees are financed into principal loan amount at closing, and interest payments are deferred until the loan repays. Closing costs are a total of $1,250, plus an additional $495 application fee, which is paid at the time of application and covers the valuation costs.
Once the loan closes there may be additional fees for servicing the loan should the loan mature or go into default.
We're talking with expert leaders to hear more about how real estate entrepreneurs and investors can make a real impact in this dynamic industry.
We’re excited to introduce you to the dynamic partnership between Groundfloor Finance and RicherValues. These two companies have teamed up to bring you innovative solutions in the field of real estate investing and financial planning. As real estate professionals, we understand the importance of understanding the value of a property before making an investment and how it can impact the potential return on investment.