Hard Money Loan

A short-term, high-interest loan backed by the property, not your credit.

Definition

Hard money lenders focus on the deal, not the borrower. They'll fund quickly (days instead of weeks) at higher rates (10-15%) with points (1-3% origination fee). Used when speed matters more than cost — foreclosures, auctions, competitive markets where traditional financing is too slow.

Pro Tip

Hard money is expensive. A $150K loan at 12% with 2 points costs you $3K in points plus $1,500/mo in interest. Factor this into your carry costs — Kaison does it automatically when you set the rate correctly.

Related Terms

Line of Credit (LOC)

A revolving credit facility used to fund property acquisitions and rehabs.

Carrying Costs (Hold Costs)

Monthly costs of owning a property during renovation: interest, insurance, taxes, utilities.

Educational content only. Consult a CPA or attorney for advice specific to your situation.