A Hard Money Loan is a specific type of asset-based financing through which a borrower receives funds secured by the value of a parcel of real estate. Typically, hard money loans are made at a higher interest rate than conventional loans and are almost never made by a commercial bank or other deposit institution.

Most hard money loans are made by private investors and the credit score of the borrower is not as important as the value for the collateral securing the loan. Typically, the biggest loan amount would be between 65% and 75% of the quick sale value of the collateral.

Generally, hard money loans are collateralized by a first lien.