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Besides the costs and risks, another drawback to hard money mortgage lenders is that they don't operate as widely as conventional lenders. You won't find hard money loan services in banks or credit unions; they're more likely to be small companies or even well-off individuals who have money to lend. Of the ones you do come across, chances are not all of them will suit your needs. After all, every borrower has a different story.

That's why doing your research is vital to finding hard money mortgage lenders. One of the best tools for this purpose is a lender matrix-a list of recognized lenders in a given industry along with their areas of specialization, lending policies, and other basic factors.