When we started in real estate over thirty years ago there were typically just two kinds of “hard money” lenders. The first type of lender was generally called a hard money lender. This was a person or company that was more or less a full time lender who would usually use a mixture of their own funds and the funds of investors to fund loans. Usually the investors where doctors, lawyers and real estate professional who where from the same general geographical area as the lender and borrower. The second type of lender was typically called a private money lender. This was person who would use their own funds to make loans to people who the lender typically knew already. These loans would often offer better interest rates and terms then a hard money lender.