One of the most frequent questions ARC Capital is asked is if we will do hard money loans for owner occupied homes either in California or other states in the US.
We only loan on owner occupied homes if the funds are specifically intended for business purposes.
This means that the loan funds are used for a business need and not for a personal, family or household use.
Examples include a loan to expand your business or a loan to put a business office in your residence.
If you have checked around, you have undoubtedly found that most hard money lenders will not do owner occupied loans. Why is that? Mostly, it is because the lending requirements set forth by the Truth In Lending Act, Regulation Z, Real Estate Settlement Procedures Act and Regulation X are stricter on owner occupied loans than non-owner occupied loans.
There are some who think that it is illegal to do a hard money loan on owner occupied properties. At the other end of the spectrum, there are others who think anything goes because it is hard money. Clearly, neither of these are correct.
In reality, there are a lot of misconceptions about lending laws that cause people to have incorrect ideas of what can and can’t be done.
If you have any questions regarding your situation please feel free to contact us today.
Also check out our services over at our main website ARCequity.com!