Hard money refers to physical currency such as coins and bills that can be physically held. It is distinct from paper money, which is simply a representation of value on a piece of paper. Additionally, hard money is occasionally used interchangeably with cash, which allows for immediate spending without the need for credit cards or checks.
Hard money refers to physical currency, such as coins and bills, that is utilised as a means of transaction. It differs from paper currency, which lacks the backing of a tangible commodity like gold or silver. An individual uses cash from their wallet to pay for their groceries, exemplifying hard money. Conversely, a business owner receives a payment in the form of a check, which they deposit into their bank account. This does not qualify as hard money since it is not physical currency. These examples demonstrate that hard money is tangible currency that can be utilised for purchases or payments. It is a widely accepted and recognized form of money as a medium of exchange.
Hard money lending is a type of loan that is secured by real estate collateral, typically used for short-term financing.
Hard money loans are typically funded by private investors or companies, and have higher interest rates and shorter repayment terms than traditional bank loans.
Hard money loans can be secured by a variety of properties, including residential, commercial, and industrial real estate.
Interest rates for hard money loans can vary widely, but are generally higher than traditional bank loans, ranging from 8% to 15% or more.
Hard money loans are typically short-term loans, with repayment terms ranging from a few months to a few years.
Hard money loans may have higher fees than traditional bank loans, including origination fees, processing fees, and prepayment penalties.
Hard money lending carries a higher risk of default than traditional bank lending, due to the higher interest rates and shorter repayment terms.
Research potential lenders thoroughly, and look for lenders with a track record of successful loans and satisfied clients.
Carefully review the terms of the loan agreement, including interest rates, repayment terms, fees, and any prepayment penalties.
Hard money loans are typically used for real estate investments or business purposes, and are not intended for personal expenses.
This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.
This glossary post was last updated: 17th April 2024.
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