Hard money loans are fast, asset-based real estate loans for investors. Learn how they work, what they cost, and when they make sense. Pre-qualify.
A hard money loan is a short-term, asset-based real estate loan. Instead of relying mainly on your personal income, the lender focuses on the value of the property securing the loan. That makes hard money a practical option when speed, flexibility, or the property's condition rules out a bank loan.
FundLogic arranges hard money loans for real estate investors nationwide as part of our real estate financing programs. We are upfront about the trade-off: hard money costs more than conventional financing. It is a tool for specific situations, not a long-term hold.
Investors typically use hard money loans to:
If you are buying and renovating a single-family home to resell, a dedicated fix and flip loan is often a closer fit. For larger commercial or multifamily repositioning, a bridge loan may offer more structure.
Hard money loans are typically:
Even though the property is the main focus, hard money is still underwritten. Lenders typically review:
Hard money loans generally carry higher interest rates than bank loans and long-term mortgages, plus origination fees (points) and other closing costs. Some also charge extension fees if you need more time.
That premium is the price of speed and flexibility. Before using hard money, ask yourself:
The biggest risk with hard money is a delayed exit. Every extra month adds interest, and a missed maturity date can mean extension fees or worse. Keep reserves and a backup plan.
The terms are often used interchangeably. Both describe non-bank loans secured by real estate. "Hard money" usually refers to professional lenders or funds with set programs, while "private money" can also mean loans from individuals. In either case, the property is the primary security and terms are usually short.
Because hard money focuses on the property and your equity, some programs can work with borrowers who have past credit issues. Credit still matters and can affect leverage and pricing. Approval is never guaranteed, and the deal must make sense on its own. Tell us about your situation and we will be straightforward about your options.
Hard money loans can often close faster than bank loans because they require less income documentation. The timeline still depends on the valuation, title work, and how quickly you provide documents. Having your purchase contract and property details ready helps the process move.
Hard money loans are generally used for investment and business-purpose real estate, not owner-occupied homes. Loans on a primary residence are subject to different consumer lending rules. If you are buying a home to live in, a traditional residential mortgage is usually the right path.
Most borrowers repay a hard money loan by selling the property or refinancing into long-term financing, such as a DSCR loan for a rental or a commercial mortgage for an income property. Lenders want to see a clear, realistic exit before closing, because the loan is designed to be short-term.
Have a time-sensitive deal? Tell us about the property and your exit plan, and we will tell you plainly whether hard money is the right tool. Pre-qualify here — it will not affect your credit. Or compare our other real estate financing programs.
