for financing that can keep up with fast-moving deals.
Online brokerage Redfin recently reported that U.S. home sales have fallen to their lowest level since 2014, excluding the 2020 pandemic period. High interest rates and tight lending standards have made conventional mortgages harder to get, especially for investors, self-employed borrowers, and buyers of properties that need major repairs.
That has opened the door for hard money loans, a type of short-term financing secured by real estate and approved mainly on the value of the property rather than the borrower’s credit score or income.
Associates Home Loan of Florida, Inc., a Tampa-based lender licensed in Florida under NMLS 380601, says many of its hard money loans close within seven to 14 days, depending on the deal. A typical bank mortgage can take several weeks.
According to the company, “hard money loans provide the speed and flexibility needed to secure and execute time-sensitive real estate investments.”
Investors use the loans to buy distressed properties, fund renovations, refinance existing debt or bridge the gap between buying a new property and selling an old one. Rental homes and some commercial properties also qualify.
Instead of focusing on tax returns and debt ratios, lenders look closely at the property itself. Associates Home Loan says it reviews the property’s location, condition, and value, any existing liens, the borrower’s experience and reserves, and the plan for paying the loan back.
That exit strategy, usually a sale or a refinance into a long-term mortgage, is a key part of the approval.
Equity matters, too. A $150,000 loan on a $300,000 property, for example, works out to a 50 percent loan-to-value ratio, leaving a cushion for the lender.
The speed comes at a cost. Hard money loans generally carry higher interest rates than conventional mortgages, along with points, appraisal, title, and closing fees. Many have short terms and may end with a balloon payment.
The company advises borrowers to review the full written terms, including the total cost of the loan and any fees tied to extensions, before signing. It also cautions that a planned sale or refinance is not guaranteed and that borrowers should be prepared for delays.
Mortgage lending in Florida is governed by Chapter 494 of the Florida Statutes, and borrowers can check a lender’s license through the Florida Office of Financial Regulation or the NMLS website.
For Florida investors who cannot wait on a bank, hard money lending solutions have become one more way to compete in a slower, more cautious market.
