A hard money loan is a short-term, higher interest loan that is collateralized by real estate. These types of loans are typically acquired by investors for business purposes or to purchase properties that need rehabbing or to make mortgage payments during a temporary lull in cash flow. Hard money loans can be used to finance a variety of projects and often come with terms like fixed interest rates and variable repayment schedules. The key advantage of these loans is their flexibility and convenience, but they tend to be more expensive than traditional mortgages.