Ready to take the next step in your Cleveland real estate journey? A hard money loan could help you secure that perfect investment property, whether you’re looking to renovate a historic home in Cleveland Heights or purchase an apartment complex in The Flats. Hard money lenders in Cleveland provide the speed and flexibility required to fast-track your projects. Ideal for situations involving tight timelines or limited startup capital, hard money loans offer an effective alternative to conventional financing.

If you’re a homeowner planning to buy and sell at the same time, we’ll also detail some viable options to make the most of your home’s equity. This article will explain the basics of hard money lending in Cleveland, helping you determine if this approach suits your investing or home-buying plans.

What is a hard money lender?

A hard money lender is a private individual or company that provides short-term loans secured by real estate. Unlike traditional banks that emphasize a borrower’s credit history, hard money lenders in Cleveland focus on the property’s value as collateral.

These lenders serve clients such as house flippers and rental property investors, who require fast and flexible funding. Loan amounts are based on the after-repair value (ARV), the projected value of a property post-renovation. They typically lend a portion of the ARV, striking a balance between profitability and risk.

Hard money loans come with interest rates from 8% to 15% or more, and repayment terms range from 6 to 24 months. Borrowers should also account for origination fees, closing costs, and points. If a borrower defaults, the lender can foreclose on the property to recoup their investment.