Five Types of Properties That Qualify for Hard Money Loans

Hard money loans have become an increasingly popular financing option for real estate investors and developers who need quick, flexible funding. Unlike traditional bank loans that rely heavily on credit scores and income verification, hard money loans are asset-based—meaning they’re primarily secured by the property itself. But not every property qualifies. So, what types of real estate are typically eligible?

Here’s a look at five common types of properties that can qualify for hard money loans:

1. Fix-and-Flip Properties

One of the most frequent uses for hard money is funding fix-and-flip projects. These are properties—often distressed or outdated—that investors purchase at a discount, renovate quickly, and resell for a profit. Traditional lenders often shy away from these deals due to the property’s condition or the short-term nature of the loan. However, hard money lenders understand the value of real estate flipping and are comfortable financing homes that need significant work. The faster turnaround and higher potential ROI make fix-and-flips an ideal fit for asset-based lending.

2. Rental Properties (Buy-and-Hold Investments)

Hard money loans can also be used to purchase or refinance rental properties, particularly when time is of the essence or the investor doesn’t meet conventional lending standards. Whether it’s a single-family home, a duplex, or a multi-unit apartment building, rental investments often qualify if the property has enough equity or potential value. Investors may use hard money to acquire a rental, then later refinance into a longer-term mortgage after the property is stabilized and cash-flowing.

3. Commercial Real Estate

Many commercial properties are eligible for hard money financing as well. These can include office buildings, retail centers, industrial warehouses, or mixed-use developments. Often, commercial projects need funding for property improvements, transitions in ownership, or to bridge a financial gap while waiting on long-term financing. Because commercial loans are generally larger and carry more variables, banks may take months to approve funding. Hard money lenders offer a faster alternative with less red tape and more flexibility in underwriting.

4. Land and Lots

Unlike traditional banks, many hard money lenders will fund raw land or vacant lots, as long as the property has sufficient value or development potential. Whether it’s residential, commercial, or agricultural land, hard money can be used to purchase the property or fund early-stage site preparation. This is especially useful for developers or investors who want to act quickly on a land acquisition before it’s gone. Keep in mind that the loan-to-value (LTV) ratio for land is often lower, but financing is still very much possible.

5. Owner-Occupied Investment Properties (with Limitations)

In certain cases, owner-occupied properties used for business or investment purposes may qualify for hard money loans—though these come with stricter regulatory oversight. For example, a borrower may live in part of a multi-unit property while renting out the rest. These types of loans often require additional documentation and compliance with consumer protection laws. Still, for borrowers who don’t qualify for a bank loan and need short-term capital, a hard money solution could work—especially if the property has strong equity or income potential.

Final Thoughts

Hard money loans offer a fast, flexible way to fund real estate opportunities that don’t fit within the narrow criteria of traditional lenders. Whether you're flipping houses, building a rental portfolio, investing in commercial space, or acquiring land, hard money financing can provide the capital you need—when you need it most.

Of course, every deal is unique. At Mister Hard Money, we evaluate each property on its own merits and help you determine if hard money is the right fit. If you’ve got a project in mind, we’re here to help you move quickly and confidently.