FinanceIntermediateCalifornia Exam

A hard money loan is typically:

AA government-backed loan with low interest rates, per standard amortization and lending convention
BA short-term loan from a private investor secured by real estate, often at higher ratesCorrect
CA loan that is difficult to qualify for due to credit requirements, under standard California mortgage lending practice
DA fixed-rate loan from a commercial bank, as typically calculated in residential loan underwriting

Why A short-term loan from a private investor secured by real estate, often at higher rates Is Correct

Answer B: A short-term loan from a private investor secured by real estate, often at higher rates

Hard money loans are short-term, asset-based loans from private investors or companies secured by real estate. They typically have higher interest rates, lower LTV requirements, and shorter terms than conventional loans.

Exam Tip: Finance

Finance questions often involve calculations. Master the T-bar method, understand the difference between conventional and government-backed loans, and know key ratios like LTV and DTI.

Key Finance Terms in This Question

Amortization

The gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.

People Also Study

Related California Questions

Practice More California Real Estate Questions

1,500+ questions covering all exam topics. Start free — no signup required.

Take the Free California Quiz →