Hard Money Lending Beyond Fix and Flip: How One Lender Serves Borrowers Left Behind

Written by:

Steve Marcinuk

Date:

29 Dec 2025

Share

Share via Facebook

Share via Linkedin

Share via X

Copy to clipboard

Since the 2008 financial crisis, hard money lending has primarily focused on short-term fix-and-flip projects, with most lenders catering almost exclusively to real estate investors. Yet some industry veterans have maintained a broader approach, targeting borrower segments that mainstream lenders typically ignore.

Geoffrey Ball, President and Mortgage Loan Originator at HD Lending, is one such lender. With 23 years in the industry, Ball has built his Arizona-based operation around what he calls “old school hard money” – a comprehensive lending model that goes beyond the six- to twelve-month investor loans that now dominate the market.

A Career Shaped by Market Cycles

Ball entered hard money lending in 2003 through a family connection, just after graduating from the University of Arizona. He began by calling mortgage brokers for their rejected deals, then moved up to managing sales teams during the pre-crisis boom.

When the 2008 mortgage meltdown forced many hard money companies out of business, Ball adapted. “Like many mortgage companies, that company went to the wayside,” he recalls. Instead of leaving the industry, he obtained his mortgage license, adjusted to new regulations, and launched HD Lending with his own investor base and referral network.

Ball’s experience through multiple market cycles has shaped his conservative underwriting and focus on loan fundamentals. “When property values go up, it masks a lot of mistakes that people make, whether they do bad loans, take on bad debt, or even lenders doing bad deals that didn’t make sense,” he says. “Now, as markets are getting tighter, you’re seeing people get into trouble.”

Serving Borrowers Traditional Lenders Reject

While most hard money lenders focus on real estate investors, Ball’s business centers on owner-occupied borrowers who don’t qualify for bank loans. “A big chunk of my borrowers are self-employed,” Ball explains. “They’re borrowers who just do not fit the banker box because of their self-employed income, their bank statement, how they write their world off.”

Many homeowners with substantial equity face barriers to traditional financing due to recent job changes, divorce, debt consolidation needs, or transitions from W-2 employment to self-employment. HD Lending designed its 30-year fully amortized loan product to help borrowers consolidate debt or fund home improvements and return to conventional financing.

“We’re a lot of times consolidating that debt, maybe doing home improvement to that borrower, but putting them on the pathway to get back to institutional financing,” Ball says.

A Broader Product Portfolio

HD Lending’s loan products address several distinct market needs:

Owner-Occupied First Mortgages: The company’s primary focus is serving homeowners with equity who need capital but cannot qualify for traditional financing due to credit, income documentation, or timing issues.

Second Mortgages: An expanding segment for borrowers who want to keep their low-rate first mortgages. “A lot of times, when you have a borrower who has a very low interest rate first mortgage where they have a sub 4% loan, they don’t want to get rid of that,” Ball says. These loans are HD Lending’s most expensive product, but fill a gap as Home Equity Lines of Credit have become harder to obtain.

Construction Lending: Both new construction for owner-builders and construction completion loans. Ball is willing to work with qualified homeowners who want to act as their own general contractor, a group banks typically refuse to finance. “Banks won’t work with a homeowner that’s qualified where they don’t want a contractor… We’ll allow them to build that home for themselves without a contractor.”

Small Commercial: Loans for industrial properties under $1 million, a segment often overlooked by larger commercial lenders. Ball recently funded an auto body shop in South Tucson, providing $240,000 against a $420,000 property for an owner-operator in business for 24 years.

Current Market Conditions and Geographic Focus

Ball operates primarily in metropolitan Phoenix and Tucson, with expansion into Prescott, Flagstaff, and nearby communities. Despite broader market challenges, HD Lending maintains steady business, averaging about 10 loans per month and projecting 122 loans closed in 2024, up from 111 in 2023.

However, the mix of businesses has changed. Purchase-money transactions have declined from 18% of volume in 2023 to 10% in 2024. “We’ve consistently seen purchase transactions go down, and I think we see it because fewer purchases are happening as interest rates have gone up,” Ball says.

Within Arizona, metropolitan Phoenix remains the company’s strongest market, especially in Paradise Valley, Scottsdale, Chandler, and the northwest Phoenix area near the new Taiwan Semiconductor facility. Outside these areas, Ball describes a buyer’s market, creating opportunities for investors who can find good deals.

Rising Challenges for Borrowers

Ball is seeing several troubling trends tied to broader economic pressures. Foreclosures are increasing, though not at crisis levels. “There’s more foreclosures happening today than there were four or five months ago. We can’t sweep that under the rug,” he says.

He attributes this to higher consumer prices, rising utility and insurance costs, and stagnant real estate values. “A lot of people have been living on debt and using debt, but there comes a point where you hit the wall,” Ball notes.

Deal failures are increasingly due to borrower strength issues, such as inherited judgments, HOA problems, or properties with flat or declining values. “As borrowers have maybe other hindrances or other problems and need a higher loan, and values are shrinking or not improving, we’re not seeing that deal get done,” Ball says.

Competition in a Specialized Niche

In contrast to the crowded fix-and-flip lending space, Ball faces little direct competition for his 30-year owner-occupied hard money loans. “There’s not a lot of competition in that 30-year owner-occupied hard money product. There are even people who don’t believe you can do an owner-occupied hard money loan, which isn’t true if you read the regs,” he says.

However, the expanding non-QM (non-qualified mortgage) market now includes some loans that would previously have gone to hard money lenders. Ball sees this as a natural evolution as the lending industry adapts to serve borrowers who don’t fit traditional criteria.

Referral-Driven Business Model

HD Lending does not spend on traditional marketing, relying instead on referrals from mortgage brokers, bankers, and real estate agents. “We pride ourselves on a referral base,” Ball says. “It’s not necessarily the ones that know us. It’s their friends and their professional associates, where they have someone in the office who says, ‘Hey, give Jeff a call. He’ll take care of you.'”

This relationship-based approach extends to borrowers, referral sources, and investors. The company maintains strong online reviews and performs well in AI-powered searches, which Ball points out “you can’t influence or pay for.”

Outlook for 2026 and Beyond

Ball expects business to remain steady through 2026 but is cautious about the broader market. “I don’t believe that our market is just going to shoot up next year. I think we’re going to continue to have a challenging market,” he says.

The outlook depends on mortgage rates and affordability. Ball expects continued strength in high-end markets like Paradise Valley and Scottsdale, where cash buyers remain active, and stock market performance supports demand.

In the complex money-lending industry, Ball’s approach demonstrates that opportunities exist beyond the fix-and-flip sector. By focusing on underserved borrowers and building long-term relationships, specialized lenders can create sustainable businesses that address real market needs.

“We are different from that traditional, what is today, the traditional hard money lender,” Ball says. With a comprehensive service model and focus on relationships, HD Lending is positioned to navigate market cycles while serving borrowers who might otherwise have limited financing options.