Hard Loans are only awarded to countries with tight currencies, stable economies and financial resources. The term "hard loan" originated in the early 1900s after World War I when it was common practice to use military appropriations (often called "war budget") to finance the government's expenses and boost economic growth. As developing nations found themselves in positions of needing hard currency, they were aided by their developed counterparts who provided little or no repayment terms; thus lending their war-time provisions at extremely low interest rates.Hard loans are a type of international loan which requires repayment in hard currency, instead of the usual soft currency. Hard loans can be classified into two types depending on the sovereign credit rating of the borrower.When you have a hard loan, your payments are denominated in a foreign currency. Some loans really are hard. These include loans made by big banks and other institutions, and some of the juicier Latin American bonds one used to see listed on the New York Stock Exchange.
