Banks can be difficult to work with because they don’t like to lend on a number of common real estate investments, such as land development, flips, rehabs, and more. Basically, it’s tough to get a bank loan for any investment property that doesn’t generate cashflow from rent. Hard money lenders came into existence specifically to provide funding for real estate investments that banks won’t touch.

Aside from that, bank loan approvals are extremely restrictive and based only on the current as-is value of the property, which doesn’t always work very well for investment properties that are being purchased especially for the purpose of renovation and resale.