Hard money is loan borrowed from individuals or from a group, other than the traditional mortgage lenders. Lenders provide money based on some collateral that the borrower has to provide as security. Hard money can be received from a money lender through a very simple and easy process. There are not many cumbersome processes involved and getting a loan is very easy.
- Hard money can be obtained if you have a good credit score.
- Your ability to repay your loan with a good income makes the entire process even easier. This is determined by measuring the ratio between your debt and your income. A person with a good ratio suggests that his repaying capacity is very good, while a person with a poor ration suggests that his repaying capacity is very poor.
- If you have a good borrowing history, you can get loans from a money lender easily.
- Hard money can be obtained very easily from money lenders, unlike loans from traditional lenders, such as banks and other financial institutions.
- Even those with poor credit scores can get hard money easily, from money lenders.
- Hard money is usually based on the collateral, provided as security, for the loan borrowed.
Features of Hard Money
Hard money refers to short-term loans from a money lender. Short-term may range from one year to five years. Usually, those who prefer hard money require short-term loans, as the borrowers will have to pay a higher interest when compared to the traditional loans. As they have provided their collateral as security, they will try to pay the interest and the principal and redeem their security. Hard money is usually borrowed by those who are not able to get the traditional loans, which are available at a more reasonable rate of interest.