Ask Cornerstone: Do any private / hard money lenders deal with owner occupied mortgages?

Owner Occupied Residence financing

I'm looking for a home equity loan for my primary residence.  I want to do repairs to rent it out.  I don't understand why private money lenders don't do owner occupied loans even if it's a small loan backed by plenty of equity.  I need the loan soon and have plenty of documented income, but my credit score is too low (570) to refinance to a larger 1st loan.

The reason most private/hard money lenders do not loan on owner occupied residences is because they are considered “consumer loans”.  A consumer loan falls under the new Dodd-Frank regulations that makes them cumbersome and doesn't allow for the higher interest rate that a private lender requires for this type of investment.

In many people's opinions, the Dodd Frank regulations,  that were an effort to “protect” consumers, hurt consumers like your self in a good financial and equity position to qualify for a private money loan but can't due to regulations.

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