Hard money lending is a term that often arises in the realm of finance and real estate. However, understanding its meaning and how it works can be a bit perplexing. In this blog post, we aim to demystify hard money lending by breaking it down into simple and easy-to-understand terms. By the end of this article, you’ll have a clear grasp of what hard money lending entails and how it can be beneficial in certain situations.

  1. What is Hard Money Lending? Hard money lending refers to a type of loan that is typically provided by private individuals or companies, rather than traditional financial institutions like banks. These loans are secured by real estate assets and are based on the property’s value rather than the borrower’s creditworthiness. Unlike conventional loans, hard money loans are often approved and funded more quickly, making them a popular choice for borrowers seeking swift financing solutions.
  2. Key Characteristics of Hard Money Lending:

    a) Collateral-Based Loans: Hard money loans are secured by collateral, usually real estate properties such as residential or commercial buildings. The value of the property acts as security for the loan.

    b) Shorter Loan Terms: Hard money loans usually have shorter terms compared to traditional loans, typically ranging from a few months to a few years.

    c) Higher Interest Rates: Hard money loans tend to carry higher interest rates than traditional loans. This is because they involve greater risk for lenders, as they cater to borrowers with lower credit scores or unique financial situations.

    d) Quick Approval and Funding: One of the major advantages of hard money lending is the expedited approval and funding process. Borrowers can often receive the funds within a few days, making it ideal for time-sensitive situations.
  3. When is Hard Money Lending Useful?

    a) Real Estate Investments: Hard money lending can be a valuable tool for real estate investors looking to finance property purchases, renovations, or fix-and-flip projects. These loans allow investors to seize time-sensitive opportunities that require quick access to capital.

    b) Credit Challenges: Borrowers with less-than-perfect credit scores or limited financial history may find it difficult to secure traditional bank loans. Hard money lending provides an alternative option for these individuals, as the focus is primarily on the collateral’s value rather than creditworthiness.

    c) Bridge Financing: Hard money loans can serve as short-term bridge financing, enabling borrowers to acquire a property quickly while they secure more permanent or traditional financing.
  4. Benefits and Considerations:

    a) Flexibility: Hard money lending offers greater flexibility in terms of loan structure, repayment plans, and eligibility criteria compared to traditional loans.

    b) Fast Approval: The streamlined approval process of hard money loans allows borrowers to act swiftly in competitive real estate markets or urgent financial situations.

    c) Higher Costs: It’s important to note that hard money loans generally come with higher interest rates, fees, and closing costs. Borrowers should carefully consider the overall costs and ensure the potential benefits outweigh the expenses.

Hard money lending provides a valuable financing option for borrowers in specific circumstances. By understanding the fundamentals of hard money lending and its benefits, you can make informed decisions when seeking quick capital for real estate investments or overcoming credit challenges. However, it’s crucial to assess the associated costs and work with reputable lenders who can guide you through the process.

Hard Money Loan Lending
Clearlease Everything you Need to know about hard money lending
Clearlease Get Fast Cash Hard Money Lending

Clearlease Financial Group – Hard Money Lenders is a  lending company offering a specialized type of real-estate-backed loan. Clearlease Financial Group, as a Hard money lender, provides short-term loans (also called bridge loans) that provide funding based on the value of the real estate that has been collateralized for the loan. Hard money lenders typically have much higher interest rates than banks because they fund deals that do not conform to bank standards.

Hard money lenders will offer a range of requirements on the loan-to-value percentage, type of real estate, and minimum loan size for a hard money loan.

Hard money risk

Hard money loans are more expensive than traditional loans because they are not based upon traditional credit guidelines which protect investors and banks from high default rates. As hard money lenders may not require the income verification that typical lenders require, they experience higher default rates (and, thus, charge a higher rate of interest). Individuals and companies may opt to take a hard money loan when they cannot obtain typical mortgage financing because they do not have acceptable credit or other documentation typically required by a conforming loan.

Hard money collateral

Hard money collateral is typically a real estate loan. This can include residential, multi-family, commercial, or raw land properties. However, it sometimes includes other assets of the individual or business borrowing the hard money. In many cases, a hard money lender will offer a smaller loan size based upon a lower “Loan To Value Ratio”. This means they may opt to loan no more than 65% of the property value. Therefore it is common for real estate investors to offer additional real estate as collateral in order to obtain a larger loan amount. This is known as cross-collateralization.

General Guidelines

*From $200,000 to $10 Million
*Collateral is equipment or real estate already owned
*Loans up to 70% of auction value or any equipment that has a verifiable secondary market
*Terms ranging from 90 days to 36 months – open terms available
*Interest rate ranges from 1% per month
*Flexible structures
*Typically, short-term loans are funded within 10 days of the initial call

Who Qualifies

*Companies with hard assets and/or real estate equity
*Distressed situations / Special loans in need of restructuring
*Tax issues (GST, PST, HST, Source deductions, etc)


Sample Equipment List

*Construction, yellow iron
*Heavy trucks and trailers
*Processing and packaging equipment
*Production line equipment
*Plastic injection molding equipment
*Metal/wood manufacturing equipment
*Drilling equipment
*Oil rigs
*Bottling Plants

Commercial hard money lender

Commercial hard money is issued to a business entity or individual signing on behalf of a business entity or corporation. It can be secured against a commercial property or residential investment property. It can also be secured against a residence in conjunction with a business property as a means of obtaining additional collateral for the lender. That type of additional security is referred to as a blanket mortgage. The sources of asset-based commercial hard money loans are generally the following:

1. Private Individuals
2. Mortgage Companies
3. Federal Banks
4. SBA Lenders

These commercial hard money lenders all have varying degrees of benefits as well as downfalls in terms of choosing a commercial hard money loan lender. For example, a private individual may offer special terms, but may be unwilling to offer a workout plan as a matter of procedure, in the event the loan becomes delinquent. A federally-chartered bank may offer a competitive loan rate in comparison to an individual, however, may demand a high pre-payment penalty fee, costing the borrower more money if they decide to sell or refinance the loan within one to five years.

Hard Money Lending

Bad credit affects many, and often find it difficult to find a home loan. Individuals with low-income levels and poor credit ratings are eligible for 2nd private mortgages too! Despite the bank’s inability to finance your mortgage, you are not without options that suit your situation. If you have equity in your property, Clearlease Financial Group can get you a mortgage!

Need a Hard Money Loan FAST? A hard money lender may be exactly what your business needs because you are consistently hearing no from the banks when you are attempting to obtain financing.

We are the hard money loan, short-term lending specialists. Deal direct with the Hard Money Lender. We offer Hard Money Loans up to $500,000,000 – FAST!

There are times when quick and creative financing is needed. We are Hard Money Loans experts. As a Hard Money Lender with fast access to the capital needed from private investors, we can help. Commercial Real Estate, Construction, or Residential Loans – Fast! All at Best Available LTVs.

Unlike traditional lending, which is largely defined by credit scores and the borrower’s ability to repay, hard money loans are based almost entirely on the value of the underlying asset. We are direct Hard Money Lenders across Australia, Asia, Canada, The EU, and the USA.

We can satisfy ALL of your lending needs and requirements.

We are known for speed, service, and integrity. Investors know that when they need a fast funding decision and a quick closing, or construction hard money loan, they can rely on us to be there for them. If you need quick access to financing to close on a property in as little as 2 weeks or less or do not meet conventional bank financing but have equity in your property Contact Us Immediately – WE CAN HELP! Deal Direct with the Lender NOW! Hard Money and Private Money Mortgage Specialist.

APPLY TODAY - Get Approved!

You're one step away from getting the financing you need: Seamlessly Secure Financing with Clearlease's Online Application.


and one of our experts will get back to you within 24 hours