This is the exact situation hard money loans exist to solve. But speed comes at a cost — literally. Rates commonly run 10%-18%, and fees can quietly erode your margin if you don't read the term sheet closely.
Hard money can fund fix-and-flip projects, rental acquisitions, commercial deals, bridge financing, and new construction when speed or property condition rules out a bank. This guide breaks down how hard money lending actually works, compares five lenders side-by-side, and shows you how to choose based on your project's numbers, not a lender's advertising.
TL;DR
- Hard money loans are short-term, real-estate-secured financing — collateral matters more than credit.
- Approval hinges on LTV, LTC, and ARV calculations plus a viable exit plan.
- Rates and fees run higher than conventional financing; total cost of capital matters more than the headline rate.
- The "best" lender depends on your property type, state, speed needs, and repayment strategy.
- Always compare written term sheets from multiple lenders before signing anything.
Overview of Hard Money Loans in the U.S. Real Estate Market
A hard money loan is short-term, asset-based financing secured by real estate, typically funded by private investors, investment funds, or nonbank lending companies. Collateral value drives the approval decision, though most lenders still review credit history, bank statements, and reserves.
This financing supports:
- Acquisitions of distressed or nonconforming properties
- Renovation and fix-and-flip projects
- Rental property purchases
- Commercial real estate investments
- Bridge financing between transactions
- New construction and development
It's different from an owner-occupied mortgage or long-term investment-property loan. Conventional financing rewards strong credit and income documentation with lower rates (Forbes reports 20% down and a 740+ score typically secures the best conventional terms).
Hard money trades that documentation burden for speed, accepting a higher rate in exchange.
Terms vary widely by asset class, state, property value, borrower experience, and project budget.
The private lending market is sizable. The American Association of Private Lenders reported $33.2 billion in private-lending originations in Q1 2025, up from $30.7 billion a year earlier, with over 7,500 active private lenders.
Here's how five commonly compared lenders stack up based on their published terms, which you should verify directly before applying.
Best Hard Money Loans and Lenders in the United States
This is a research-based comparison, not an endorsement. Lender terms, state availability, and eligibility requirements change frequently. Confirm current product pages, licensing status, and fee schedules directly with each lender before treating any "best for" label as final.
Kiavi
Kiavi, now part of Figure, lends in 49 states plus D.C. Its fix-and-flip product targets non-owner-occupied single-family homes, condos, PUDs, manufactured housing, and 2-4 unit properties.
What stands out: Kiavi advertises up to 100% LTC and 80% ARV, with closings in as few as 7 days. That is a fast turnaround for this leverage level.
| Feature | Detail |
|---|---|
| Loan terms | 12, 18, or 24 months |
| Leverage | Up to 100% LTC / 80% ARV |
| Rate floor | 7.75% |
| Loan size | $100K-$5M |
| Fees | No application fee, no prepayment penalty stated |
| Closing speed | As few as 7 days |
| Minimum credit | Not published on reviewed pages |
Kiavi doesn't explicitly confirm direct-lender status on its public pages. Clarify that point in your loan documents.
Lima One Capital
Lima One's Bridge Plus product serves non-owner-occupied 1-4 unit properties needing purchase or refinance financing (properties needing heavy rehab are excluded from this specific product).
What stands out: No prepayment penalty on Bridge Plus, plus licensed operation across 46 states — a strong fit for investors who want flexibility on repayment timing.
| Feature | Detail |
|---|---|
| Loan terms | 13 or 19 months |
| Loan size | $100K-$5M |
| Leverage | Up to 80%-85% LTV (page discrepancy; confirm which applies) |
| Minimum credit | 700 FICO for Bridge Plus |
| Prepayment penalty | None on Bridge Plus |
| State restrictions | Not available in Alaska, North Dakota, South Dakota, Vermont |
One important flag: Lima One's own materials show an 85% LTV headline but an 80% figure in the FAQ. Get written clarification before you count on either number.
RCN Capital
RCN positions itself as a nationwide direct private lender serving fix-and-flip and rental investors. Its collateral list includes non-owner-occupied 1-4 family homes, condos, townhomes, 5+ unit apartments, and mixed-use property.
Why investors look at RCN: It advertises up to 100% of purchase price plus 100% of renovation cost, capped at 75% ARV. That is aggressive leverage for repeat investors with a track record.
| Feature | Detail |
|---|---|
| Loan terms | 12-18 months |
| Rate floor | 9.49%, charged only on outstanding balance |
| Closing speed | As few as 10 business days |
| Licensing note | Licensed in Arizona, California, Minnesota, and Oregon (confirm your state) |
| Leverage | Up to 100% purchase + 100% rehab, capped at 75% ARV |
That last point matters. "Nationwide" is marketing language here. RCN's own disclosure notes programs may not be available in every state.
New Silver
New Silver explicitly identifies as a direct hard-money lender, a clearer stance than some competitors take on that point. Its fix-and-flip program funds purchase-plus-rehab or refinance-plus-rehab deals.
What stands out: The most detailed public pricing disclosure of the five lenders reviewed here. That helps if you want to model costs before applying.
| Feature | Detail |
|---|---|
| Interest rate | 8.5%-11% |
| Origination fee | 1%-1.75% |
| Leverage | Up to 90% LTC / 75% ARV |
| Loan term | Up to 18 months |
| Loan size | $100K-$5M |
| Minimum credit | 650 FICO |
| Approval speed | As fast as 5 minutes for term sheet/proof-of-funds |
New Silver doesn't publish draw-schedule mechanics or valuation methodology on its main pages, so ask for both before finalizing your rehab budget.
Visio Lending
Visio isn't a hard money lender. It is a DSCR (debt-service coverage ratio) rental lender, and its own materials describe it that way. Including it here matters because investors often confuse rental refinancing with bridge financing.
Main distinction: 30-year fixed terms with no balloon payment, qualifying borrowers on rental income rather than personal income or a fast-exit timeline.
| Feature | Detail |
|---|---|
| Down payment | 20%-30% typical |
| Underwriting | Appraisal required to confirm rental value and DSCR |
| Minimum credit | 680 |
| Reserves | Six months required |
| Entity ownership | Mandatory in eight states, optional elsewhere |
| Closing speed | Aims to close within 30 days |
| Loan structure | 30-year fixed, no balloon |
If your project needs acquisition and rehab draws, Visio is the wrong tool. If you need a long-term hold loan after stabilization, compare it against a hard-money refinance.
How We Chose the Best Hard Money Lenders
Three mistakes trip up most first-time hard money borrowers:
- Chasing advertised speed without confirming the lender actually funds their property type and state
- Anchoring on the headline rate while ignoring points, fees, and draw charges
- Skipping the fine print on extension policies and default interest
We scored lenders on the four criteria below.
Total Cost of Capital, Not Just Rate
Review every line item before you compare offers:
- Points and origination fees
- Underwriting and appraisal charges
- Draw fees and legal/closing costs
- Extension fees, default interest, and prepayment penalties
One point equals 1% of the loan amount. The American Association of Private Lenders cites 1-3 points as a typical private-lending range. Add every cost through your planned exit date, not just at closing.
Collateral and Project Fit
Confirm how each lender calculates:
- LTV (loan-to-value)
- LTC (loan-to-cost)
- ARV (after-repair value)
Ask whether the loan covers acquisition, renovation, construction, and soft costs, and whether your budget includes reserves for overruns. Commercial assets and heavy-rehab projects often get different treatment than turnkey rentals.
Lender Legitimacy
Verify whether you're dealing with a direct lender, broker, marketplace, or fund manager. Each structure carries a different risk profile.
Check state licensing (AAPL notes that 18 states restrict some business-purpose mortgage lending). Review servicing and foreclosure provisions before you sign.
Speed, Flexibility, and Repayment Risk
Compare realistic closing timelines with draw schedules, interest-only versus amortizing payments, and balloon exposure at maturity.
Require a written exit plan (sale, refinance, or rental stabilization) before you commit to any offer.
Conclusion
The best hard money lender is the one whose collateral standards, funding structure, total cost, and repayment terms actually match your project—not the one with the fastest advertised close or the lowest rate on a landing page.
Before you apply, work through the full picture:
- Model acquisition, renovation, carrying costs, and financing fees
- Add a contingency buffer for overruns
- Compare multiple written offers side by side
- Bring in a real estate attorney, tax advisor, or CPA when contracts or numbers get complex
If you're weighing options beyond a single hard-money quote, Lendora Funding works nationwide with startups, established businesses, and real estate investors on residential, commercial, rental, fix-and-flip, bridge, and cash-out refinancing. Confirm current product terms and eligibility directly.
Frequently Asked Questions
What is a hard money loan and how does a hard money lender work?
A hard money loan is short-term, asset-based financing secured by real estate and funded by private or non-bank lenders rather than banks. Lenders underwrite mainly on collateral, equity, and your exit plan, fund quickly, and can enforce their security interest if you default.
How difficult is it to get a hard money loan?
Approval is often more flexible than a conventional mortgage since it emphasizes collateral over credit. You'll still need adequate equity, a viable project, acceptable leverage ratios, proper documentation, and a credible exit strategy.
Do hard money lenders require a credit check?
Policies vary by lender. Some place limited weight on credit, but most still review credit history, borrower experience, liquidity, and income or guarantor strength to gauge repayment risk.
What rates and fees should I expect from a hard money lender?
Pricing varies significantly by lender and deal risk, generally landing between 7%-15%. Review interest, points, origination, closing, draw, extension, default, and prepayment charges in a written term sheet before comparing lenders.
How long do you have to pay back a hard money loan?
Most hard money loans run 6-18 months and may end with a balloon payment. Confirm your exact term, available extensions, and the sale or refinance deadline before you close.
How do I choose the best hard money lender?
Compare legitimacy and direct-funding status, property and state eligibility, leverage limits, total cost, closing speed, and servicing terms. Match those factors to your realistic exit strategy before you sign.
