Hard Money Loan
A hard money loan is short-term, asset-based financing from a private lender rather than a bank, priced mainly on the property's value and exit plan rather than the borrower's credit.
These loans carry higher interest rates (often 9-14%) and points than conventional financing, along with shorter terms — from six months to a few years — but underwriting moves quickly since approval centers on collateral value and ARV rather than income documentation.
Hard money is widely used across Northern California's investor market to fund fix-and-flip purchases on distressed houses in Sacramento, Placer, and Yuba counties, where a conventional 30-year loan wouldn't close fast enough or the home wouldn't qualify for financing in its current condition.
A buyer using hard money to purchase your property can typically close faster than a conventional buyer since there's no lengthy underwriting — but the higher carrying cost also shapes how aggressively that buyer can bid, which helps explain how investor offers get built.
Need Personalized Help?
Every situation is different. Get a free, no-obligation consultation and cash offer for your specific property.