What should I look for in a hard money lender?

I have been thinking of getting hard money loans to
help funds my projects. Sadly, hard money lenders have
such bad reputation and I am scared of being scammed.
That is why I would like to ask for your expert help.

What should I look for in a hard money
lender/site/company? Especially with regards to the
terms, length of loan, etc.

I thank you in advance for the help.

Your answers will be appreciated.


Find out from your local Real estate Investment Club who the other members use. There is also a list on the left side of this page under “Investor Resources”.


Your question is very valid. In search of a private lender your first step should be the service they provide and if your asset fits their criteria. If you fit their criteria you should begin your exploration into if their rates and if they fit your pocket. Next, you should look and see what type of deals they have done in the past. I would not weigh this as too much of a necessity because most of the lenders today, except for a few are new and up and coming with new lines of credit and investment pools. If they have the money then and they can close a loan then they should be considered. However, closing a loan can be very complex to a borrower and you want to make sure the lender has the capacity and the experience (and the legal team) that will make sure the closing goes smoothly.

The length of the loan depends on what your business model is suggesting. Most private money is for the short term so your exit strategy is crucial. When approaching the lender make sure your exit strategy is discussed. This will give them a sigh of relief also.

Hard Money Lending has a slightly negative vibe mostly because of the type of borrower that has looked for hard money in the past. The companies are upstanding and legit for the most part but it is the fast moving borrowers who used to be the prime customer for a hard money loan that has given it a negative vibe. In today’s market there is a new type a borrower because of the lack of institutional money. This borrower is more sophisticated and morally tactful. This is a great time for private money!!!

Hard money stinks. Always has…always will. Private money is definitely the way to go. Plus…their is so much money out there right now. People have it under their pillows cause they don’t want to invest in stocks. Go find the private money. Its out there!


Where can I find a trusty private money lender? Thank you.

Talk to your friends… Go to REI meetings…


I’d get recommendations from my friends in the area that are doing deals. I agree with some of the others that private money is better and most times cheaper than hard money. If the deal is good then either will do, you may pay a couple more points with hard money.

Call all the “we buy houses” signs and talk to these guys. They are your competition but generally they will tell you who’s lending at a decent rate. Most of us in the REI world have an abundance mentality. It’s a cliche’ but it’s all about relationships, so go out and build them. It’ll pay off in the long run.


Generally speaking, which do you prefer the most? Hard money or private money? considering all the aspects? Also, can you suggest me the best lender here in Tampa?

Thanks Joe