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Roughly 80% of the American population currently have out a loan product. That number sheds light on the fact hundreds of millions of people have turned to responsible lenders to help them through financial pinches in their lives.

No matter your reason for doing so, if you’re thinking about borrowing money you may be struggling to find a lender who is willing to give you what you need. You may have also considered a hard money loan.

But do you fully understand what a hard money loan is?

A hard money loan offers borrowers an additional way to borrow the cash they need quickly. The loan relies more on collateral than traditional loan factors like credit or income.

Below, our team at Hard Money Georgia have put together some pros and cons of hard money loans so you can decide if getting one is right for you.

What is a Hard Money Loan?

A hard money loan is a collateral based loan. What that means is that in order to attain the money you’re looking to get, you would need to offer up a piece of property in exchange (vehicle, stocks, home, etc).

Your property can stay in your possession and if you pay back your loan amount, you retain it without issues. Putting a piece of property on the line simply gives lenders an insurance policy that you’ll pay back what you’re borrowing.

What Are Some Pros of a Hard Money Loan?

There are numerous reasons one might turn to a hard money loan which include:

Ease of Approval

If you’ve had trouble getting approved for a loan in the past you’ll likely have an easier time with a hard money loan. A hard money loan doesn’t pay mind to your credit score or income.

Instead, it evaluates the worth of the property you offer and allows you to borrow against that value.

That means that your primary barrier to getting the money you need is having collateral that’s worth the amount you’re looking for.


A hard money loan is fast. Because there’s no need to go deep into your credit or income history, you can often expect to get the money you need much quicker than a traditional loan.


Hard money loans tend to be more flexible than traditional loans. Many times, lenders are willing to work with borrowers on amounts borrowed and payment schedules in a way that more traditional lending institutions will not.

What Are Some Cons to a Hard Money Loan

A hard money loan has some additional considerations borrowers should be aware of including:

Property Risk

As explained, hard money loans use your property as collateral. That means that if you default on the loan, your property could be repossessed.

Loan to Value Ratios

Some hard money borrowers are caught off guard when their property is valued lower than they feel it should be. This decreased loan to value ratio is common however and is used to protect lenders from fluctuating market conditions.

On average, expect to be offered 50% – 70% of your property’s current market value in loan income.

Wrapping Up Hard Money Loans

Hard money loans give people who need money fast an additional way to get it. This loan type doesn’t mind if you have bad credit or variable income. What it looks for is a form of collateral in exchange for the loan.

If you’re in the Atlanta Georgia area and are looking for a reputable hard money lender, look no further than Hard Money Georgia.

We specialize in offering hard money/bad credit loans quickly and painlessly. Get started on your way to getting the money you need, today!