A borrower (at times referred to as a trustor) is a person who is in need of money, and is willing to pledge collateral and pay interest in order to gain access to a lump sum of liquidity (money). Most lenders who provide hard money loans are individuals or groups of individuals who are sophisticated investors. Once a borrower executes a loan agreement with a lender, the loan is processed and serviced through a Loan Servicing company. The borrower is required to make monthly payments on the loan according to the terms of the Note. Late payments can and do incur extra fees and penalties, and can result in the lender foreclosing on the property that has been pledged as collateral for the loan. It is important for the borrower to maintain close contact with the Loan Servicing Company, and to alert the Loan Servicer of any anticipated difficulties as soon as they arise.