Loan Glossary

A short-term, asset-based loan from private investors rather than banks. Hard money loans close quickly but carry high interest rates (8%–15%) and are commonly used by real estate investors for fix-and-flip projects.

A revolving line of credit secured by home equity. Borrowers can draw funds as needed during the draw period (typically 10 years), then repay the balance during the repayment period.

A lump-sum second mortgage secured by home equity, with a fixed interest rate and fixed monthly payments. Often called a "second mortgage" because it is subordinate to the primary mortgage.

A standard form previously used to itemize all charges imposed on a borrower and seller in a real estate transaction. Replaced by the Closing Disclosure (CD) under TRID rules.