Mortgage lenders have a minimum loan amount when buying or refinancing a home. The good news is that this amount varies from lender to lender, so some are more lenient than others. It may not be easy to find lenders willing to offer small mortgage loans, but it is possible. Most lenders will share their maximum mortgage amounts up front, but not the minimum.
To find the right loan, you may need to do some research and meet with small mortgage lenders and representatives of local banks and credit unions. Small home loan lenders generally require borrowers to meet the same minimum mortgage requirements as they would for a larger loan amount. However, these loans come with higher interest rates and shorter terms than larger loans. It's important to consider the benefits and drawbacks of a small mortgage loan before making a decision.
If you can't find a traditional lender to provide you with your small mortgage loan, a hard money lender could be an alternative. Borrowers should expect to pay higher mortgage rates with loans that are especially small. It's always important to do your homework and learn the ins and outs of mortgage lending.
