Hard Money Loans

Hard money loans are backed by the value of the property, as opposed to the credit worthiness of the borrower. Hard money loans carry high interest rates.

Hard money loans come not from traditional lenders (banks, etc.), but from entities that see value in a more inherently risky loan. A few situations in which a hard money loan might be seen as a viable option:

•Short-term financing
•Flips
•The buyer has poor credit but substantial equity and is trying to avoid foreclosure.

 

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