A hard money lender is an established lender that offers private loan funding to individuals to purchase real estate. A hard money lender can be an individual private investor, a group of investors or a licensed mortgage broker. The common thread between various hard money lending entities is the use of private funds to grant loans.
This sets hard money lenders apart from banks, which utilize money from their depositors to fund loans. Another key difference between hard money lenders and banks is speed. Hard money lenders are often able to fund loans at a faster pace than a traditional lender, allowing borrowers to move quickly on new investment opportunities.