Reference Network 1

Hard money loans are a type of property based loans similar to bridging loans. They are usually tied to real estate and have a much higher interest rate than traditional commercial property loans. They are often used by businesses in distressed financial situations: eg. as bankruptcy or foreclosure is imminent.

When Should You Take a Hard Money Loan?

Hard money loans are usually only a viable choice when the alternative is to quick sell property. The cause can be a distressed general financial situation. Even though the interest rates for hard money loans can be almost double what a commercial property loan usually has, selling property quickly below real value would be an even worse choice.