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Hard Money Loan
       
 
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Hard Money Loan

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Hard Money Loan
A loan of "last resort" or a Short-term Bridge loan.
    
Hard money loans are backed by the value of the property, not by the credit worthiness of the borrower. Since the property itself is used as the only protection against Default by the borrower, hard money loans have lower loan-to-value (LTV) ratios than traditional loans. A hard money loan is a specific type of asset-based loan financing in which a borrower receives funds secured by the value of a parcel of Real Estate. Hard money loans are typically issued at much higher Interest rates than conventional commercial or residential property loans and are almost never issued by a Commercial bank or other Deposit Institution.
    
Hard money loans carry Interest rates even higher than traditional sub-prime loans. Since traditional lenders, such as banks, do not make hard money loans, hard loan lenders are sometimes private individuals that see value in this type of potentially risky venture. Hard money loans are used in turnaround situations, Short-term financing, and by borrowers with poor credit but substantial Equity in their property that wish to stave off foreclosure.
Posted by  Henley & Partners Group Holdings Ltd
 
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