Thanks, I am curious what other lenders' experiences have been.

Brad- I hear you regarding Eastern.  Emigrant Mortgage offers a similar product and I think Yale Mortgage does still as well.  I am talking about private hard money lenders, usually individuals and hedge funds who lend their own money.

Laura- Hard Money is loosely defined as a loan that does not adhere to typical Fannie Mae/FHA/Conventional Financing standards for a myriad of reasons: a property could have zoning issues, be in need of repairs, the borrower may not qualify for financing for credit/income/seasoning reasons.  Most hard money lenders want to hold a loan for a year or so, collect some upfront points and charge a higher rate of interest.  the borrower can then repair their credit/property and refinance into a conventional loan.

A recent example of a hard money loan I came across was a potential client who owned a multi-unit investment property in need of upgrades in order to get rented.  The clients credit had been compromised as well.  There was plenty of equity in the the property and thus a hard money lender approved the loan.  This loan would not have gone through a cnventional lender due to the credit issues as well as the property condition, despite the equity.