Most hard money loans require monthly payments which are interest-only payments during the term of the loan and then a balloon payment at the end of the term.

Here are some common payment structures:

  • Interest-Only Payments: Common for short-term loans (ex. fix and flip loans) where you pay just the interest each month and the principal at the end.
  • Monthly Payments: Amortized loans where you pay both principal and interest monthly.
  • Balloon Payments: You may pay only interest monthly and make a lump sum payment of the full principal balance at the end of the loan term.

The payment structure will depend on the lender and the specific loan agreement, so it’s important to clarify the terms before signing.