Deal funding · Asset-based

Hard money loans: funding for the deal that can't wait for a bank.

A hard money loan is a short-term, asset-based loan on investment property. The lender sizes it on the house, the rehab and your way out rather than your paycheck, and published closings run about one to three weeks. You pay for that speed in rate and points, so price the whole hold before you bid.

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Loan sizing

Hard money is sized on the house, the work and the way out.

WORKED DEAL · OHIO SHERIFF SALE TO RESALE IN 7 MONTHS

Winning bid at the sheriff sale: $160,000
Deposit paid on sale day: $5,000
Purchase advance: 85% of the bid: $136,000
Rehab holdback: 100%, two $28,000 draws: $56,000
Total loan: 68.6% of the $280,000 ARV: $192,000
1.5 points + $1,995 document fee: $4,875
Interest at 10.5% on drawn funds, 7 months: $10,780
Your cash in: $24,000 down + fees + interest: $39,655
Sale at ARV, less the $192,000 payoff: $88,000

Spread before selling costs$48,345

The balance was due within 30 days of the court confirming the sale, with no extensions from the sheriff, so the loan had to close inside that window. Draws were released at the end of months 1 and 3. 10.5% sits inside the middle half of 2025 non-bank rates. Charged on the full $192,000 from day one, interest would be $11,760. A 3-month slip adds $5,040 and still fits a 12-month term; past month 12, one published schedule charges 1% ($1,920) for 3 more months. Excludes title, insurance, taxes, utilities and selling costs. Illustrative, not a quote.

A bank starts with your income. A hard money lender starts with the property: what it's worth today, what it will be worth once the work is done (the after-repair value, or ARV), and how quickly it would sell if you stopped halfway. Your credit and track record still count, but they tune the terms rather than decide the file. That's how a house with a caved-in roof, no furnace or a court-ordered sale date gets funded.

Three limits size the loan, and the smallest one wins. Lenders advance a share of the price (85–100% on October 2026 rehab programs, depending on experience), fund up to 100% of the rehab in draws, and cap the total at 70–80% of ARV. Take a $200,000 house, a $40,000 rehab and a $300,000 ARV: 90% of the price plus the rehab is $220,000, and 75% of ARV is $225,000, so you borrow $220,000. If the comps only support $280,000, the cap drops to $210,000. The ARV is the number that decides it.

Experience moves every limit. RCN Capital's published grid gives a new investor (up to two flips in three years) up to 80% of the price and 70% of ARV, with rates from 10.74%. More than 10 flips and a 720 score earn 95% and 75% from 9.24%. A first deal with a heavy rehab drops to 70% of the price and 60% of ARV. Lima One wants one exit in the past 36 months; New Silver and Roc ask for none.

Valuation is where files speed up or stall. Kiavi and Easy Street value in-house and say no appraisal is required. New Silver orders an appraisal with interior access backed by six sales within 5 miles from the past 12 months, and it won't lend below $100,000 of as-is value or $150,000 of ARV.

Lending on the asset also puts the asset, your guarantee and your calendar on the line. Price these risks before you sign.

Max loan = smaller of (price × purchase % + rehab budget) and (ARV × ARV cap)

The balloon. In 2025 federal HMDA data, 95.1% of short-term investor loans ended in a balloon: the whole balance due on one date. A sale that drifts past it turns into an extension fee or a default.
A soft ARV. If the valuation lands under your number, the cap shrinks the loan and the sale price shrinks the profit, both at once.
Draw lag. Rehab money is released after an inspection, about 24–48 hours later at the fastest lenders, so you or your contractor front every phase. Budget for the float.
Recourse. Most loans close in an LLC with your personal guarantee, and some lenders publish full recourse, which reaches assets outside the deal.
Fees you didn't model. Points are due at closing however short the hold, and default rates and late fees are rarely published. Get them on the term sheet.
Auction terms. At an Ohio sheriff sale, a buyer who can't pay the balance risks losing the deposit, and the house is sold sight unseen. Line up the loan before you bid, and carry a contingency in the rehab budget.

Deal checklist

What gets a hard money loan approved: the property, the plan, then you.

Lenders start with the collateral and the exit. These ranges come from lender program pages in October 2026; each lender sets its own limits.

Property: Non-owner-occupied 1–4 unit homes, condos and townhomes at most programs; Easy Street goes up to 8 units. Lima One and New Silver want a value or price of at least $100,000.
Valuation: In-house with no appraisal at Kiavi and Easy Street; an interior-access appraisal at New Silver; self-directed appraisals in 5 days or less at Lima One.
Purchase advance: 85–100% of the price, set by experience and scope. RCN's tiers run from 80% for a new investor to 95% past 10 flips.
Rehab: Up to 100% of the budget, held back and released in draws after each inspection.
ARV cap: Usually 70–80% of ARV, with first-time flippers and big scopes held to 60–70%.
Loan size: $50,000–$5,000,000 across published programs. The median 2025 short-term investor loan was $265,000.
Credit: 600 minimum at Easy Street, 650 at New Silver and RCN, 660 at Lima One. Scores of 720+ reach the top tiers.
Experience: None required at New Silver and Roc; one exit in 36 months at Lima One. Each completed flip buys more leverage and a lower rate.
Liquidity: Cash to close plus a cushion. OfferMarket asks its guarantors to show the closing cash and another 25% of the rehab budget.
Exit: A sale the comps support, or a refinance the rent can carry, with a term that outlasts the plan.
Borrower: Usually an LLC with a personal guarantee: 80.9% of 2025 short-term investor loans went to entities. Some lenders are full recourse.
Locations: Rural property, raw land and parcels over 5 acres are common exclusions, and some lenders skip whole states or metros: Easy Street leaves out four states plus Baltimore, Chicago and Detroit.
Not needed: W-2s, tax returns or a debt-to-income ratio at Kiavi, LendingOne and many others.
Use: Business purpose only. A home you or your family will occupy calls for a residential mortgage, not hard money.

Contract to closing

Four moves that get a hard money deal funded and closed on time.

Send the deal on day oneAddress, price, rehab budget, ARV comps, exit and closing date. The 60-second form takes the basics, and a loan specialist calls you back for the rest.
Read the term sheet line by lineRate, points, each fee, how interest accrues, the draw process, extension and default terms, and the maturity date. Check which limit set your loan.
Start valuation and title that weekThey set the closing date more than anything else. Have LLC documents, insurance and proof of funds ready so you're deal-ready when the file is.
Close, draw, exitRequest each draw as a phase finishes, keep receipts and photos, and list or start the refinance with months left on the term.

Cost of the money

What hard money costs: rate, points, fees and how interest is charged.

Price the hold in dollars, not just the rate. Rates come from 2025 federal HMDA data on 66,029 short-term investor loans, analyzed by Crowdfunded Wealth, and from lender pages in October 2026.

Note rate: 2025 median 10%. Non-bank lenders made 83.3% of the loans at a 10.45% median, with the middle half between 9.75% and 11%. Banks and credit unions: 7.5%.
Advertised starting rates: 7.75% at Lima One, 8.25% at Kiavi and Roc, 8.5%–11% at New Silver, 8.90% at Easy Street, and 9.24% (experienced) to 10.74% (new investor) at RCN. Starting rates go to the strongest files.
Loan size: Small loans pay a little more: a 10.5% non-bank median under $150,000, against 9.95% at $1 million or more.
Points: A point is 1% of the loan amount, due when the loan funds: 0–2 at Easy Street, 1–1.75% at New Silver, 1.5–2 with a $2,000 minimum at OfferMarket. Lima One lets you defer origination until you exit.
Flat lender fees: Easy Street publishes a $1,995 document fee. Ask for every processing, underwriting and servicing fee by name.
Draw and wire fees: $270 a draw and $30 a wire on OfferMarket's schedule, so five draws add $1,350.
How interest accrues: Only on funds drawn at LendingOne and RCN; on the full loan at OfferMarket when it's under $100,000. In the worked deal, the difference is $980.
Points over a short hold: 1.5 points and a $1,995 fee on $192,000 held 7 months add roughly 4.35 percentage points a year to the note rate.
Extensions: OfferMarket: 1% of the loan for a first 3 months, 1.5% for a second 3, or 2.5% for 6, capped at half the original term. Interest keeps running.
Prepayment: None at Easy Street, LendingOne, RCN and OfferMarket, which also charges no minimum interest. Ask anyway: exit fees and minimum-interest clauses act like a penalty.
Default terms: Rarely published. Get the default rate, late fee and grace period in writing before closing.
Third-party costs: Valuation, title, insurance and recording are billed on top of the lender's fees.

Where your deal fits

Your deal needs hard money when the clock or the condition rules out a bank.

Sheriff sales and auctionsOhio sheriff sales take a deposit on sale day ($2,000, $5,000 or $10,000, set by the county's appraised value) and the balance within 30 days of the court's confirmation. Financing is allowed if you arrange it, and the sheriff can't move the date.

Short contract windowsKiavi advertises closings in as few as 7 days, LendingOne in 7–10 business days, and Easy Street can fund in as little as 48 hours when every party is ready. A fast, certain close is part of your offer.

Condition a bank won't touchNo kitchen, a failed inspection, fire or water damage, an estate sold as-is. Hard money lends against the finished value and funds the work in draws, so the house only has to be worth fixing.

Cash you want backPaid cash to win it? Kiavi will refinance a cash or home-equity purchase inside 6 months and hand that money back. Later than that, it lends on current value as a seasoned refinance.

Proof of funds before you bidSellers and auction platforms often want to see the money first. Some lenders issue a proof-of-funds letter up front; New Silver advertises an instant one.

When to passIf 10.5% interest, 1.5 points and a 3-month slip would erase the spread, the deal needs a lower price, not a faster loan.

Side by side

Four ways out of a hard money loan, and what each needs on payoff day.

The lender sizes the loan to an exit, so choose yours before you bid. The first two are plans. The last two are what you reach for when a plan slips.

Exit	When it fits	What has to be true
Sell	A flip whose comps support your ARV, in a market that will buy it before the term ends.	Time on market plus closing fits before maturity. Most published programs charge no prepayment penalty, so selling early saves interest.
Refinance into a rental loan	You'd rather keep it. DSCR (debt service coverage ratio) means monthly rent over the total monthly payment; a DSCR loan approves the property on that ratio, not on your income.	A DSCR of 1.00 at most lenders (0.75 at some), about 75% of appraised value on a cash-out, and roughly 90 days of ownership. Lima One waives seasoning when you refinance with it; Roc caps the loan at 80% of your total cost basis if you've owned the property under 3 months.
Refinance into a bridge loan	The work is done, but the house hasn't sold or leased and the rehab loan is running out.	Roc's stabilized bridge caps the loan at 70% of value and at 85% of the price plus verified completed work if you've owned it under 6 months. Listed homes need C2 condition or better.
Extend	A short slip, with payments current.	The fee (1%–2.5% on OfferMarket's schedule) plus the extra interest costs less than a rushed sale. A fallback, never the plan.

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Investment property only, never your own home

Straight answers

Hard money loans: what investors ask before they commit.

What is a hard money loan?

A short-term loan on investment property from a non-bank lender, sized mainly on the property's current value, its after-repair value and your exit rather than your income. Terms run 6–24 months, interest-only, with the balance due at the end. Investors use hard money to buy quickly, renovate, then sell or refinance into a long-term rental loan.

What interest rate do hard money lenders charge in 2026?

Federal HMDA data put the 2025 median for short-term investor loans at 10%, and 10.45% at non-bank lenders. Half of all non-bank loans priced somewhere from 9.75% to 11%. Advertised starting rates in October 2026 ran from 7.75% to about 9.24% for the strongest files. Points and fees come on top, so compare total dollars over your hold.

How do points work on a hard money loan?

Each point costs 1% of the loan amount when the loan funds: 1.5 points on $192,000 is $2,880. Published programs charge 0–2 points, often with a flat document fee. Because you pay points once on a loan that may last only months, they weigh more than they look: over a 7-month hold, 1.5 points and a $1,995 fee add about 4.35 percentage points a year.

How much cash do I need for a hard money deal?

The gap between the purchase advance and the price, plus points, fees, closing costs and monthly interest. At 85% of a $160,000 price, that's $24,000 down before fees. Lenders also check liquidity: OfferMarket asks guarantors to show the closing cash and another 25% of the rehab budget. The rehab itself is usually financed, but you front each phase until its draw is released.

Will a hard money lender fund a sheriff sale or auction purchase?

Often, when the sale gives you time to close. Ohio sheriff sales take a deposit on sale day and the balance within 30 days of the court confirming the sale, and buyers may use financing they arrange themselves. Where full payment is due on the spot, you need cash; Kiavi will then refinance a cash purchase within 6 months to put that money back.

How fast can a hard money loan close?

Plan on one to three weeks. In October 2026, Kiavi advertised closings in as few as 7 days and LendingOne in 7–10 business days, while Easy Street said it can fund in 48 hours once every party is ready. The valuation and title work usually set the pace, so order them as soon as your offer is accepted.

Do hard money lenders require an appraisal?

Not all of them. Kiavi and Easy Street value property in-house and say no appraisal is needed, which can take days off a closing. New Silver requires an appraisal with interior access and six recent sales within 5 miles. If you can't get inside before closing, as at a sheriff sale, ask how the lender will value the property before you commit.

What credit score do I need for a hard money loan?

Published minimums in October 2026 ran from 600 at Easy Street to 650 at New Silver and RCN and 660 at Lima One. The score rarely decides the loan by itself, but it moves the terms: RCN's top tier, with 95% of the price and its lowest starting rate, requires 720 or more and more than 10 completed flips.

Can I get a hard money loan with no experience?

Yes. New Silver and Roc published no experience requirement in October 2026, while Lima One asks for one exit in the past 36 months. Expect less leverage on a first deal: RCN's new-investor tier lends up to 80% of the price and 70% of ARV, falling to 70% and 60% when the rehab is heavy.

What if I can't repay a hard money loan at maturity?

Ask for an extension before the date passes. OfferMarket prices 3 extra months at 1% of the balance, a second 3 at 1.5%, or 6 at 2.5%, up to half the original term, and interest keeps accruing. A sale, a bridge loan or a rental refinance can also pay it off. Passing maturity with none of those lined up can trigger default terms.

Do I pay interest on rehab money I haven't drawn?

Not at many lenders. LendingOne and RCN charge interest only on funds disbursed, so the rehab holdback costs nothing until it's released. Others charge on the full loan from day one; OfferMarket does so on loans under $100,000. In the worked $192,000 deal, the difference between the two methods was $980 over 7 months.

Can I keep the property and refinance out of hard money?

Yes, it's the usual exit for a property you hold. A DSCR (debt service coverage ratio) loan, which divides the rent by the monthly payment, replaces the short-term debt. Expect about 75% of appraised value on a cash-out and roughly 90 days of ownership first. Lima One waives seasoning and takes up to 50% off its origination fee when you refinance with it.

Can I use a hard money loan on a house I'll live in?

No. Hard money from an investor lender is business-purpose credit, so neither you nor your family can occupy the property. A house you'll move into, even one that needs a full renovation, should be financed with a consumer home loan from a residential lender.

Other ways to fund the deal

Where these numbers come from (17)Checked October 26, 2026

Each rate, limit, fee and timeline on this page is a range we took from lender rate sheets, published program terms and public lending data, dated as listed. Read them as a picture of the market rather than a quote. What a lender offers on your deal turns on the house itself, your credit score and how many projects you have finished.