Hard Money Lenders are private companies or individuals who lend out capital to fund real estate deals. The loans, called "Hard Money Loans" or "Private Money Loans" can be a significant source of financing for real estate investors needing short-term access to funds.
Hard money lenders have a variety of different rates, fees, and terms that you will need to become fully acquainted with. Rates and fees are typically much higher than conventional mortgages, usually ranging between 8 and 15% depending on the loan amount and term length. When taking out a hard money loan, you will usually pay a fee ranging between 3 and 10% of the loan amount; this fee is also known as paying "points."
Finally, hard money lenders typically lend for only very short terms, usually between 6 and 36 months. Hard money loans should never be used in place of a regular mortgage - such as for a rental or your primary residence, unless you have a clearly defined exit strategy in place to pay the loan off within the time frame allocated.