All about Hard Money Lenders that you should be Aware of

Several first time investors would be curious about who is a hard moneylender. What do you mean by hard money loan? How could one avail hard money loan? Is hard money loan is beneficial for you? These would be some of the question that would cross your mind when you come across the term hard money loan for the first time. Before you actually encounter with a California hard money lender, you should be conversant with the basic principles of hard money lending.

Hard Money Lenders

What do you understand by the term ‘hard money lending?’

Let us first understand the term hard money lending. A brief introduction would be the discussion of money between investors. However, the money in question has been considered either hard or soft money. Generally, soft money has been easier to understand. The term used for soft money would be flexible. On the other hand, hard money is entirely the opposite, making it more restrictive. The terms have been more difficult to acquire, but are strict and more specific. Hard money has been known to be derived from private individuals, having plenty of money at hand. For this reason alone, hard money has been referred to as private money. This kind of money has been used for investment purposes, which comes directly from common people. These people are not a money lending institution. Therefore, their initial priority would be to safeguard their investment capital. This has been the major reason that makes the term to be extremely strict.

hard money lending

Terms of hard moneylenders

In case, you have been wondering what are the terms implied by hard money lenders, you should be understand that it would vary from one lender to another. Hard money loans were primarily based on any deal or property at hand. Actually, hard moneylenders would loan money only up to a specific percentage of the actual market value of the property. In case, there is a default on the behalf of the borrower, the hard moneylender would be earn considerable profit by selling to the end buyer or foreclose the account.


In the present times, several hard moneylenders, in order to stay in business would need more than mere equity for qualifying. The reason has been availability of favourable laws for consumers. The consumer protection laws, which have been both expensive and time-consuming court procedures, would have forced hard money lenders to use harsh measures when applying for loan.

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