When you are looking to buy the most lucrative types of properties in the market -- smaller properties that need rehabilitation for resale -- you have probably found that traditional lenders cannot give you the money or the terms to make the deal work. Hard money lenders, on the other hand, love these deals and can get you in control of the property very quickly.

If you're a property investor, you know that hard money loans are a very powerful tool. In exchange for paying a slightly higher interest rate and origination fee, they give you fast access to money on very favorable terms. While traditional lending is an excellent option for some transactions, hard money is the way to go for deals that need a little something extra.

One of the biggest misconceptions about private money lenders is that they charge very high interest rates for making very small loans. In fact, they charge rates that are relatively close to the long term average rate for mortgages on investment property and they frequently offer attractive interest-only payment schedules. Furthermore, because of the unique way that they calculate their loan to value ratios, they can actually provide generous loan proceeds for investors looking to buy and rehabilitate properties.