Hard Money & Private Money Loans
What is a hard money loan and who qualifies?
Asset-based capital that closes in days — for deals a bank or DSCR lender can't touch. Hard money (also called private money) is short-term, asset-based real estate financing: we underwrite the property, the equity position, and your exit — not your tax returns. Where a bridge loan is specifically a transition loan on a property you intend to stabilize and refinance, private money is broader. It funds vacant and distressed buildings, rehabs, unentitled land, partner buyouts, auction and foreclosure-clock deals, note payoffs, and cash-out against equity you already own.
Reviewed and updated August 9, 2026
- Short-term, asset-based financing — 6–24 months, interest-only, up to 80% of as-is value.
- Closes in 5–14 days; property condition and occupancy are not disqualifiers.
- Broader than a bridge loan: acquisitions, rehab, land, cash-out, partner buyouts, and note payoffs.
- No income documents, no DSCR test — priced on equity, exit, and experience.
- Business-purpose only, vested in an LLC, LP, or corporation.
Asset-based capital that closes in days — for deals a bank or DSCR lender can't touch.
Hard money (also called private money) is short-term, asset-based real estate financing: we underwrite the property, the equity position, and your exit — not your tax returns. Where a bridge loan is specifically a transition loan on a property you intend to stabilize and refinance, private money is broader. It funds vacant and distressed buildings, rehabs, unentitled land, partner buyouts, auction and foreclosure-clock deals, note payoffs, and cash-out against equity you already own.
Get your Private Money Term Snapshot.
Send the property, the equity, and your exit — we return an asset-based sizing snapshot: max loan against as-is value, interest-only carry, points and fees, total hold cost, and the takeout that retires the loan.
- Max loan against as-is (and after-repair) value
- Interest-only monthly carry and total hold cost
- Points, fees, and minimum-interest exposure
- Exit check — sale proceeds or DSCR refinance coverage
Illustration only, generated from the information you enter. Not a loan estimate, pre-qualification, commitment to lend, or approval. Formal pricing, LTV, and terms are issued only after credit review, income/asset documentation, and full underwriting.
What hard money actually is
Hard money — used interchangeably with private money — is real-estate lending where the collateral does the qualifying. The lender's protection is the equity cushion between the loan amount and the property's value, plus a credible exit. Because there is no income verification, no DTI calculation, and no secondary-market guideline to satisfy, decisions are fast and the collateral can be ugly. You pay for that in rate and points.
Hard money vs. a bridge loan
Every bridge loan is private money, but not every private money loan is a bridge. A bridge loan is a specific structure: a short-term loan on a property you plan to stabilize and refinance into permanent debt on a defined timeline. Hard money is the broader category and covers situations a bridge program will not:
- Land and lots with no income and no near-term stabilization event.
- Heavy distress — fire damage, code violations, gut condition, or no certificate of occupancy.
- Partner buyouts and estate settlements where the "exit" is a sale or a later refinance with no fixed date.
- Note payoffs and maturing balloons where speed matters more than price.
- Cross-collateralized deals that pledge equity in a property you already own to buy the next one.
How pricing works
Private money is priced on risk, not on a rate sheet. Expect roughly 9.5%–13% interest-only with 1.5–3 points of origination. The drivers are:
- Leverage: 60–65% of as-is value prices materially better than 80%.
- Exit certainty: a signed listing, a refinance pre-approval, or verified DSCR coverage lowers the rate.
- Experience: completed deals in the last 36 months improve both pricing and leverage.
- Asset type: single-family and small multifamily price best; raw land prices widest and caps near 50–55% LTV.
- Term: 6-month paper is cheaper than 24-month paper; many programs carry a 3–6 month minimum interest guarantee.
Illustrative only. Not a quote or commitment to lend.
What we underwrite
- Value: a BPO or appraisal establishing as-is value, and after-repair value where there is a renovation budget.
- Equity and skin in the game: 20%+ of the purchase from the borrower on acquisitions, or verified existing equity on a refinance.
- Exit: a specific, dated plan — sale, DSCR refinance, portfolio loan, or multifamily takeout.
- Liquidity: enough to carry interest and any renovation gap, typically 3–6 months of payments.
- Credit: 620+ preferred, but a low score with strong equity is workable. Open judgments, tax liens, and an active bankruptcy require review.
Business-purpose only
Every private money loan we place is business-purpose under Regulation Z: investment, renovation-for-resale, or commercial use, vested in an LLC, LP, or corporation. We do not place hard money on a primary residence or against a home you or a family member occupy. If you plan to move into the property, this is a consumer-purpose loan and a different product.
Get your Private Money Term Snapshot
Send the property, the equity, and your exit — we return an asset-based sizing snapshot: max loan against as-is value, interest-only carry, points and fees, total hold cost, and the takeout that retires the loan.
- Max loan against as-is (and after-repair) value
- Interest-only monthly carry and total hold cost
- Points, fees, and minimum-interest exposure
- Exit check — sale proceeds or DSCR refinance coverage
Illustration only, generated from the information you enter. Not a loan estimate, pre-qualification, commitment to lend, or approval. Formal pricing, LTV, and terms are issued only after credit review, income/asset documentation, and full underwriting.
Why investors choose this Hard Money loan program
Asset-based underwriting with a BPO or rush appraisal — designed to compete with cash offers.
Vacant, gutted, failed inspection, or mid-renovation are all financeable.
No tax returns, no W-2s, no DTI. Business-purpose credit to an entity.
Single-family, 2–4 unit, small multifamily, mixed-use, and land — not just stabilized rentals.
Get your Private Money Term Snapshot
Send the property, the equity, and your exit — we return an asset-based sizing snapshot: max loan against as-is value, interest-only carry, points and fees, total hold cost, and the takeout that retires the loan.
- Max loan against as-is (and after-repair) value
- Interest-only monthly carry and total hold cost
- Points, fees, and minimum-interest exposure
- Exit check — sale proceeds or DSCR refinance coverage
Illustration only, generated from the information you enter. Not a loan estimate, pre-qualification, commitment to lend, or approval. Formal pricing, LTV, and terms are issued only after credit review, income/asset documentation, and full underwriting.
Hard Money qualifications at a glance
Program guidelines vary by investor. These are typical ranges — a Loan Officer confirms exact numbers on your scenario.
| Requirement | Typical | Notes |
|---|---|---|
| Minimum credit score | 620 preferred | Lower considered at reduced leverage with strong equity. |
| Max LTV (as-is) | Up to 80% | 70% cash-out; 50–55% on land. |
| Max loan-to-ARV | 70–75% | Where a renovation budget is escrowed. |
| Term | 6–24 months, interest-only | Extensions available for a fee. |
| DSCR / income docs | None required | Asset-based underwriting only. |
| Loan amount | $75K – $5M | |
| Origination | 1.5–3 points typical | |
| Rate range | ~9.5%–13% interest-only | Illustrative; set by leverage, exit, and experience. |
| Reserves / liquidity | 3–6 months of interest | |
| Vesting | LLC / LP / Corp required | Personal guaranty standard. |
| Minimum interest | 3–6 months typical | Applies if you pay off early on some programs. |
| Time to fund | 5–14 days | Title and insurance are usually the critical path. |
Ranges are typical program guidelines and vary by investor, credit tier, and market. Not a commitment to lend.
Hard Money loan use cases
- Auction, foreclosure-clock, and off-market acquisitions that need cash-like speed
- Vacant, distressed, or non-conforming properties a bank will decline
- Partner buyouts, note payoffs, and probate/estate settlements
- Cash-out against equity to fund the next deal
- Land and lot acquisition ahead of an entitlement or build
Get your Private Money Term Snapshot
Send the property, the equity, and your exit — we return an asset-based sizing snapshot: max loan against as-is value, interest-only carry, points and fees, total hold cost, and the takeout that retires the loan.
- Max loan against as-is (and after-repair) value
- Interest-only monthly carry and total hold cost
- Points, fees, and minimum-interest exposure
- Exit check — sale proceeds or DSCR refinance coverage
Illustration only, generated from the information you enter. Not a loan estimate, pre-qualification, commitment to lend, or approval. Formal pricing, LTV, and terms are issued only after credit review, income/asset documentation, and full underwriting.
Hard Money rate & market update
Compiled from Freddie Mac PMMS, U.S. Treasury, and BLS releases. Figures are published with the period they cover and the date they were retrieved.
Hard money calculator: leverage, carry, and exit coverage
Private money is priced on equity and exit, not income. Model your loan against as-is value, the true cost of the hold including points and minimum interest, and whether the sale or refinance actually pays the loan off.
Deal inputs
Cost of capital
Exit assumptions
Results
- Private money loan amount
- $266,250
- Cash to close
- $27,070
- Monthly interest-only carry
- $2,496
- Origination
- $5,325
- Interest billed
- $17,473
- Total cost of capital
- $25,793
- Refinance proceeds
- $266,250
As-is LTV cap is the binding limit — 75% of as-is value.
Down payment plus points and fees.
2 pts on the loan amount.
7 months at the minimum-interest floor.
Roughly 16.6% annualized on the loan amount once points, fees, and carry are counted.
The refinance retires the private loan and returns about $0 above the payoff.
Illustrative only. Not a quote, lock, appraisal, or commitment to lend. Final leverage, rate, points, minimum interest, and term are set in underwriting based on the asset, your equity, experience, and documented exit. Business-purpose loans only — no owner-occupied property.
Hard Money loan vs. other investor financing
Private money against the alternatives investors weigh when a deal has to close fast.
| Feature | Hard / Private Money | Bridge Loan | Fix & Flip | DSCR Loan |
|---|---|---|---|---|
| Underwriting basis | Equity + exit | Asset + business plan | ARV + scope of work | Rent vs. PITIA |
| Time to fund | 5–14 days | 10–14 days | 10–21 days | 21–30 days |
| Typical rate | 9.5% – 13% IO | 8% – 11% IO | 9% – 12% IO | 6.9% – 8.9% amortizing |
| Points | 1.5 – 3 | 1 – 2 | 1.5 – 2.5 | 0 – 1 |
| Term | 6–24 months | 12–24 months | 12 months | 30 years |
| Rehab funds | Optional escrow | Light only | Up to 100% escrowed | None |
| Land eligible | Yes, 50–55% LTV | Rarely | No | No |
| Condition/vacancy OK | Yes | Mostly | Yes | No — must be rent-ready |
| Best for | Speed, distress, odd collateral | Clean stabilize-and-refi | Buy-renovate-resell | Long-term hold |
Eligible & ineligible properties for a Hard Money loan
If your asset is on the eligible list, we can quote it. If it's on the ineligible list, we'll usually still route you to a program that fits.
- Single-family and 2–4 unit investment property
- Small multifamily and mixed-use
- Vacant, distressed, and non-conforming buildings
- Entitled or near-entitled land and lots
- Auction, foreclosure, probate, and estate acquisitions
- Cash-out against an existing free-and-clear investment property
- Primary residences and any owner-occupied property
- Second homes and family-occupied property
- Consumer-purpose transactions of any kind
- Cannabis-use properties and other federally prohibited uses
- Properties with unresolved environmental contamination
- Raw, unentitled acreage with no plan (case-by-case only)
Get your Private Money Term Snapshot
Send the property, the equity, and your exit — we return an asset-based sizing snapshot: max loan against as-is value, interest-only carry, points and fees, total hold cost, and the takeout that retires the loan.
- Max loan against as-is (and after-repair) value
- Interest-only monthly carry and total hold cost
- Points, fees, and minimum-interest exposure
- Exit check — sale proceeds or DSCR refinance coverage
Illustration only, generated from the information you enter. Not a loan estimate, pre-qualification, commitment to lend, or approval. Formal pricing, LTV, and terms are issued only after credit review, income/asset documentation, and full underwriting.
Benefits and trade-offs of a Hard Money loan
- Speed — 5–14 days, competitive with a cash offer.
- Condition, vacancy, and occupancy are not disqualifiers.
- No tax returns, W-2s, DTI, or DSCR test.
- Funds asset classes bridge and DSCR programs exclude, including land.
- Cross-collateralization can get you to 100% of a purchase price.
- Same-lender exit into a DSCR, portfolio, or multifamily loan.
- Materially more expensive than DSCR — 9.5%–13% plus 1.5–3 points.
- Short fuse: the term ends whether or not your exit is ready.
- Minimum-interest provisions can make very fast payoffs costly.
- Lower leverage on land and heavily distressed assets.
- Personal guaranty is standard even with entity vesting.
- Not available for owner-occupied or consumer-purpose transactions.
Get your Private Money Term Snapshot
Send the property, the equity, and your exit — we return an asset-based sizing snapshot: max loan against as-is value, interest-only carry, points and fees, total hold cost, and the takeout that retires the loan.
- Max loan against as-is (and after-repair) value
- Interest-only monthly carry and total hold cost
- Points, fees, and minimum-interest exposure
- Exit check — sale proceeds or DSCR refinance coverage
Illustration only, generated from the information you enter. Not a loan estimate, pre-qualification, commitment to lend, or approval. Formal pricing, LTV, and terms are issued only after credit review, income/asset documentation, and full underwriting.
Hard Money loan worked example
An investor wins a county auction at a discount to value and needs to fund inside the settlement window, then refinances into a 30-year DSCR loan once the tenant is placed.
- Auction purchase price
- $285,000
- As-is value (BPO)
- $355,000
- Leverage
- 75% of as-is value
- Rate (interest-only)
- 11.25%
- Origination
- 2 points
- Term
- 12 months
- Market rent after lease-up
- $2,750 / mo
- Private money loan amount
- $266,250
- Borrower cash to close (incl. costs)
- ~$32,000
- Interest-only payment
- $2,496 / mo
- Origination cost
- $5,325
- Held 7 months — total carry + points
- ~$22,800
- DSCR refinance at 75% LTV
- $266,250 — pays the private loan in full
- DSCR after refinance
- 1.24x
Outcome: Speed bought a $70,000 equity spread for roughly $22,800 of carry, and the DSCR refinance retired the private loan without new cash. Illustrative only; not a quote, appraisal, or commitment to lend.
Illustrative only. Not a rate quote, lock, offer, or commitment to lend. Binding terms appear on your Loan Estimate.
Hard Money loan process: from scenario to close
- STEP 1Scenario call
Address, purchase or payoff, condition, equity, and exit. Same-day indicative terms.
- STEP 2Term sheet & deposit
Signed terms and a third-party report deposit start the clock.
- STEP 3Valuation
BPO in 48–72 hours, or a rush appraisal where required.
- STEP 4Title, insurance, entity docs
Run in parallel — this is usually the critical path, not underwriting.
- STEP 5Fund
5–14 days from signed terms on a clean file. Rehab funds, if any, are held in escrow.
- STEP 6Exit
Sell, or refinance into a DSCR, portfolio, or multifamily loan with the same lender.
Get your Private Money Term Snapshot
Send the property, the equity, and your exit — we return an asset-based sizing snapshot: max loan against as-is value, interest-only carry, points and fees, total hold cost, and the takeout that retires the loan.
- Max loan against as-is (and after-repair) value
- Interest-only monthly carry and total hold cost
- Points, fees, and minimum-interest exposure
- Exit check — sale proceeds or DSCR refinance coverage
Illustration only, generated from the information you enter. Not a loan estimate, pre-qualification, commitment to lend, or approval. Formal pricing, LTV, and terms are issued only after credit review, income/asset documentation, and full underwriting.
Hard Money loan document checklist
Here's what to have ready when you apply. Missing items can be added during processing — but a complete file closes faster.
- Government-issued photo ID (driver's license or passport) for every guarantor
- Entity documents (LLC / LP / Corp): Articles of Organization, Operating Agreement, EIN letter, Certificate of Good Standing
- Voided check or bank letter for the funding account
- Two most recent months of asset statements showing down payment + reserves
- Homeowners / landlord insurance quote naming the lender as mortgagee
- Purchase contract (purchase) or existing note & mortgage (refinance)
- Preliminary title commitment ordered through an approved title company
- Current lease(s) or Section 8 HAP contract if the property is tenant-occupied
- Property tax bill and HOA statement (if applicable)
- Payoff statement from current lender (refinance only)
- Purchase contract, auction confirmation, or existing note and payoff statement
- Written exit plan with dates — sale, refinance, or takeout loan
- Scope of work and renovation budget, if any funds are being escrowed
- Proof of funds for the down payment and closing costs
- Track record: addresses and outcomes of deals completed in the last 36 months
- Photos or inspection report showing current property condition
- Title commitment or prior owner's title policy, if available
Hard Money loans in Florida, Colorado, and LLC-eligible states
Simply Approved Mortgages LLC (NMLS #2620881) is a mortgage broker, not a direct lender, and arranges residential mortgage loans in Florida and Colorado. Hard Money business-purpose loans may be arranged in additional states only where permitted by applicable law and pursuant to applicable licensing requirements or exemptions.
Hard Money loan questions, answered
The questions investors ask us most — plus the exact answers we give on the phone.
What is the difference between hard money and a bridge loan?
A bridge loan is a specific short-term structure on a property you intend to stabilize and refinance. Hard money is the broader category and also covers land, heavily distressed assets, partner buyouts, note payoffs, and cash-out where there is no defined stabilization event.
How fast can you actually fund?
5–14 days from signed terms on a clean file. Valuation comes back in 48–72 hours via BPO; title clearance and the insurance binder are usually what set the timeline.
What credit score do I need?
620 is our preference, but private money is equity-first. A weaker score is workable at lower leverage. Active bankruptcy, open judgments, and unresolved tax liens need review before we issue terms.
How much do I have to bring to closing?
Plan on 20–25% of the purchase price plus closing costs and interest reserves. If you own another property with real equity, cross-collateralizing it can reduce or eliminate the cash requirement.
What does hard money cost?
Roughly 9.5%–13% interest-only plus 1.5–3 points of origination, depending on leverage, exit certainty, experience, and asset type. These figures are illustrative and not a quote.
Do you lend on land?
Yes, on entitled or near-entitled land at roughly 50–55% LTV with a clear entitlement, build, or resale plan. Raw unentitled acreage is reviewed case-by-case.
Can I use hard money to buy at a foreclosure auction?
Yes. Send us the parcel and the auction date early — we can usually be in a position to fund inside the deposit and settlement windows most counties impose.
Is there a prepayment penalty?
No exit-based penalty, but most programs carry a 3–6 month minimum interest provision. If you expect to pay off in 60 days, tell us up front and we will price the term accordingly.
Can I refinance out of a hard money loan with you?
Yes — that is the standard path. We roll private money into a 30-year DSCR loan, a portfolio blanket loan, or permanent multifamily debt, reusing the file and often the valuation.
Will you finance renovation costs?
Yes. Renovation dollars are held in escrow and released on inspection-verified draws. If the project is a buy-renovate-resell, our fix and flip program is usually the cheaper fit.
Can I get a hard money loan on my primary residence?
No. Every loan we place is business-purpose and vested in an entity. Loans secured by a home you or a family member occupies are consumer-purpose and outside this program.
Do you require an appraisal?
A broker price opinion is often sufficient and is faster. We order a full appraisal on larger loans, unusual assets, and where after-repair value drives the sizing.
What happens if my exit slips past the maturity date?
Contact us early. Extensions of 3–6 months are commonly available for a fee, and in many cases refinancing into a DSCR or portfolio loan is both faster and cheaper than extending.
Which states do you lend in?
Entity-vested, business-purpose private money is available across our 37-state and DC service area. Florida and Colorado are also licensed for consumer-purpose lending.
Which calculators should I run before financing a rental?
Start with the DSCR calculator to test rent against the payment, then the cap rate calculator for the unlevered yield, the cash-on-cash return calculator for the levered year-one return, and the ARV calculator when the plan involves a rehab. All outputs are illustrative estimates, not an approval, an offer of credit, or a commitment to lend.
Do the calculators work for every state?
No. Results are shown only for the states where we arrange financing, where Simply Approved Mortgages LLC arranges business-purpose investment property financing. Selecting any other state withholds results — the check runs on our servers and fails closed.
Can I share or save my calculator results?
Yes. Every calculator produces a share link that encodes the scenario inputs only — names, emails, phone numbers, and addresses are never included — plus a copy-to-clipboard summary of the key numbers you can paste into an email or a deal memo.
What is Simply AI and can it approve my loan?
Simply AI explains the figures already shown on the page in plain English. It provides educational explanations only, does not quote rates, does not confirm eligibility, and cannot approve financing. Rates, eligibility, fees, and terms are subject to verification and change — speak with a licensed loan originator before making a financing decision.
Government & regulatory references
Independently verify program rules and consumer protections.
Related programs & tools
Cheaper when the deal is a clean stabilize-and-refinance.
Private money with a rehab escrow and draw schedule.
The long-term takeout once the property cash-flows.
Permanent debt for stabilized apartment buildings.
Ground-up builds instead of acquisition and rehab.
37 states plus DC for entity-vested investment property.
Run the numbers on your Hard Money deal
Free calculators for the metrics underwriting actually looks at, plus side-by-side deal comparisons. All outputs are illustrative estimates and are not an approval, offer of credit, or commitment to lend.
Whole-deal underwriting: PITIA, DSCR, NOI, cap rate, cash-on-cash and refinance proceeds.
Test rent against PITIA and see the ratio a lender underwrites to.
Year-one levered return on the cash you actually put into the deal.
NOI, unlevered yield, and implied value at your target cap rate.
Comp-based after-repair value with the 70% rule and profit projection.
Model the rehab loan and the DSCR refinance in one place.
The monthly rent required to reach a 1.00, 1.10 or 1.25 ratio.
Full monthly PITIA — principal, interest, taxes, insurance and dues.
LTV, CLTV, equity, and proceeds available at your target leverage.
Proceeds, new payment, DSCR impact and break-even in months.
Cash to close: fees, prepaids, escrow reserves and credits.
Cash flow, DSCR and principal paydown side by side.
Cost of a step-down prepay at your planned exit year.
Investor metrics for the markets where we arrange financing.
Deal comparisons
- DSCR Loan vs BRRRR Strategy
- DSCR Loan vs Fix & Flip Loan
- DSCR Long-Term Rental vs Short-Term and Mid-Term Rental Financing
Program availability, leverage, and terms vary by state and program. Business-purpose, non-owner-occupied investment property only; owner-occupied use is not supported. Simply Approved Mortgages LLC is a mortgage broker and arranges — but does not make — loans. Equal Housing Opportunity.
Get your Private Money Term Snapshot.
Send the property, the equity, and your exit — we return an asset-based sizing snapshot: max loan against as-is value, interest-only carry, points and fees, total hold cost, and the takeout that retires the loan.
- Max loan against as-is (and after-repair) value
- Interest-only monthly carry and total hold cost
- Points, fees, and minimum-interest exposure
- Exit check — sale proceeds or DSCR refinance coverage
Illustration only, generated from the information you enter. Not a loan estimate, pre-qualification, commitment to lend, or approval. Formal pricing, LTV, and terms are issued only after credit review, income/asset documentation, and full underwriting.
Get your personalized investor loan quote
Pick the loan type that fits your deal and complete a short, tailored pre-qualification. A licensed loan officer follows up with an initial scenario review once we have your credit authorization and supporting documents — usually the same business day. Formal pricing and terms follow underwriting.
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The form below is tailored to DSCR rental loan — only the questions your program needs.