Finance
What is a 'hard money loan'?
AA government-backed loan with strict requirements
BA short-term, asset-based loan from a private lender with higher rates, used often by investors or those who cannot qualify conventionally✓ Correct
CA loan with a fixed rate guaranteed for 30 years
DA loan from a credit union
Explanation
Hard money loans are short-term loans from private investors or companies, secured primarily by the value of the property (the 'hard asset') rather than the borrower's creditworthiness. They feature higher interest rates and fees but can close quickly, making them popular for fix-and-flip investors.
Related California Finance Questions
- What is the primary difference between a mortgage and a deed of trust?
- In California, a deed of trust differs from a mortgage primarily because it:
- What is seller financing (purchase money mortgage)?
- What is the primary purpose of the Truth in Lending Act (TILA) as it applies to California residential mortgage loans?
- Under California's anti-deficiency statutes, which type of loan is protected from a deficiency judgment after non-judicial foreclosure?
- What does 'points' mean in mortgage financing?
- An adjustable-rate mortgage (ARM) has a rate cap structure of 2/2/6. What does the '6' represent?
- Discount points paid on a mortgage loan are best described as:
Practice More California Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free California Quiz →