Frequently Asked Questions
We’ve simplified the journey with a comprehensive list of frequently asked questions, and our experienced team is ready to provide expert guidance. Contact us anytime or call (410) 205-1710 to get started today.
1. How Does A Hard Money Loan Work In Real Estate?
Like a typical mortgage, hard money loans work by using the property itself to secure the loan. In other words, if the borrower defaults on the loan, the lender can take possession of the property to cover their losses.
2. Why Would Someone Use A Hard Money Loan?
People use hard money lenders for quick, flexible financing, especially for real estate, when traditional banks deny loans due to poor credit, distressed property conditions, or the need for fast closing (days vs. weeks) for “fix-and-flip” projects, auctions, or unique properties, relying on the property’s value (collateral) more than borrower financials.
3. Who Uses Hard Money?
What are hard money loans used for? Because of their short repayment period and higher interest rates compared to mortgages and other types of loans, hard money loans are often used by real estate investors who are more likely to have money available for the balloon payment once the repayment period ends.
4. How Fast Can A Hard Money Loan Close?
Hard money loans typically close in 3–7 days, with some lenders capable of closing in as little as 24–48 hours after receiving all necessary documentation. This rapid turnaround is much faster than traditional bank loans (30-60+ days), making them ideal for competitive real estate, such as auctions or fix-and-flip projects.