Who Gets Hard Money Land Loans?
Typically, hard money loans are for people with bad credit, no credit, an impending foreclosure, or some other red flag that causes banks and other lending institutions to balk. Rather than take a risk on them, banks usually decline their applications. Hard money lenders, on the other hand, are more open to them, especially if they have equity in a home or property. Also, real estate investors borrow hard money from private (or hard money) lenders on a short-term basis to purchase or upgrade properties. Again, banks are reluctant to loan money for certain types of non-traditional investments, and these lenders fill this niche. Since hard money loans are typically for high-risk people, the rates and fees are substantially higher than regular bank loans.
