Finance
In Colorado, a 'hard money loan' is characterized by:
AA. A low interest rate and strict underwriting
BB. A short-term, asset-based loan with higher interest rates, typically from private lenders, often used by investors for quick acquisitions or properties needing renovation✓ Correct
CC. A government-backed loan for low-income borrowers
DD. A long-term fixed-rate loan for commercial properties
Explanation
Hard money loans are short-term, asset-based loans where the loan amount is based primarily on the property's value (the 'hard asset'), not the borrower's creditworthiness. They carry higher interest rates (often 8-15%+) and points, with shorter terms (6-24 months). They are used by real estate investors for fix-and-flip projects, bridge financing, or properties not qualifying for conventional loans.
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