Commercial Hard Money Loans

Hard money is available for those opportunities that come around when there might not be sufficient cash-flow and the property or business is not what we call “performing”. Basically “performing” means that the investment or business has enough cash coming in currently to pay the debt and other expenses associated with it. Banks only lend on “performing” properties or businesses. You have to prove to them through financial statement (usually tax returns) that your investment or business is performing before they even consider the loan.

Non-performing or under-performing investments or businesses do not have sufficient cash-flow currently and require another type of financing which we would call hard money. This is money used to transform an investment or business from non-performing status to performing status and needed only for a short period of time.

It is usually interest-only and for a six month to three year time period because it is only intended to be a short-term fix. The investor or business owner can then secure long-term financing once the project is sufficiently cash-flowing thus going from “non-performing” status to “performing” status.