When should I use hard money instead of a DSCR loan?

Use hard money at 8.99%–13.5% interest-only when you need speed, the property is distressed or vacant, or your exit is a sale or BRRRR refi within 6–18 months. Use DSCR at 5.75%–10.5% when the asset is stabilized, leased, and you plan to hold — underwriting sizes on as-is value and rent coverage, not ARV.

Can I finance 100% of a fix-and-flip project?

Qualified sponsors on select files can reach up to 100% loan-to-cost on non-owner-occupied fix-and-flip and new-construction projects — still subject to ARV caps (typically up to 75% of after-repair value) and full collateral underwriting. Most deals require 10%–15% sponsor equity when LTC, as-is LTV, and ARV tests are run together.

How fast can Jaken Finance Group close hard money vs DSCR?

Hard money and bridge files on qualified investment property typically close in 7–10 business days after appraisal payment and borrower conditions clear. DSCR permanent loans on stabilized rentals target roughly 14 business days — longer because income, lease, and as-is appraisal must support long-term PITIA at 5.75%–10.5%.

Blog

Hard Money & DSCR: Investor Product Stack Guide

Published June 12, 2026 · Updated July 18, 2026

By Jason Taken · Principal, Jaken Finance Group

Hard money at 8.99%–13.5% and DSCR at 5.75%–10.5% — how investors stack bridge, fix-and-flip, and rental debt on non-owner-occupied deals nationwide.

Most investor portfolios fail at the capital layer, not the acquisition layer. You find the deal, model the spread, and then discover the wrong product — a 30-year DSCR quote on a gut rehab, or a 12-month IO bridge on a stabilized fourplex you intended to hold for a decade. Jaken Finance Group underwrites two distinct stacks for non-owner-occupied real estate: short-term collateral debt at 8.99%–13.5% and long-term income debt at 5.75%–10.5%. This guide maps when each product applies, how leverage is sized, and how experienced sponsors chain them on fix-and-flip, BRRRR, and buy-and-hold files.

What is a hard money loan · DSCR loans hub · Fix-and-flip requirements

Jaken Finance Group product stack — 2026

Product	Rate band	Term	Sized on
Fix-and-flip / hard money	8.99%–13.5% IO	6–12 months	LTC, as-is LTV, ARV cap
Bridge	8.99%–13.5% IO	12–24 months	As-is value + exit plan
100% LTC (select)	8.99%–13.5% IO	6–18 months	Qualified sponsor + ARV
DSCR rental	5.75%–10.5% P&I or ARM	30-year	As-is LTV + rent coverage

Coverage is nationwide from Hoffman Estates, IL. Every program finances non-owner-occupied investment property only — no primary residences.

Hard money underwriting is collateral-first — ARV, LTC, and exit drive the term sheet. DSCR underwriting is income-first — rent against PITIA at the note rate. Neither stack requires W-2 or tax-return documentation on qualified files, though sponsor experience, entity structure, and reserve posture still affect pricing inside the published bands.

Hard money stack — acquisition, rehab, and bridge exits

Hard money is collateral-first, short-term debt. Underwriters care about purchase basis, rehab scope, sold comps, and a credible exit — not W-2 income or tax returns. That is why distressed SFR, manufactured housing, mixed-use acquisitions, and commercial bridge files land here instead of at a bank.

Fix-and-flip — the core hard money file

A standard fix-and-flip packages acquisition funding plus rehab draws into one IO note at 8.99%–13.5%. Leverage is never a single headline percentage. Underwriters run three tests and take the lowest:

Loan-to-cost (LTC) — total advances against purchase + hard + soft costs (often up to 90% on qualified files; select sponsors reach 100% LTC)
As-is LTV — acquisition leg against today’s appraised value
ARV cap — cumulative loan against after-repair value (typically up to 75% ARV)

The binding constraint wins. Sponsors who model only LTC routinely overestimate proceeds.

Illustrative Midwest SFR:

Line	Amount
Purchase	$155,000
Rehab + contingency	$48,000
All-in cost	$203,000
ARV (sold comps)	$265,000

At 90% LTC the math allows $182,700 — but 75% ARV caps at $198,750, so LTC binds. Sponsor equity to project: roughly $20,300 plus closing and carry. Monthly IO at 10.5% on $182,700 ≈ $1,599 — model 6–9 months hold and 8% sale costs before you lock scope.

Understanding loan-to-cost ratios · LTV and ARV caps in hard money

Bridge — when the exit is not a retail flip

Bridge at the same 8.99%–13.5% band covers acquisitions where the business plan is lease-up, refinance, or entity restructuring — not a six-month cosmetic turn. Common files include stabilized-but-vacant multifamily, commercial asset classes (MHP, RV parks, mixed-use), and transitional collateral that will not qualify for DSCR until tenants execute.

Bridge terms run 12–24 months IO. Underwriters stress the exit: DSCR refi pro forma, sale contract, or portfolio disposition timeline. Thin exit documentation is the primary decline reason — not rate.

100% LTC — for qualified sponsors only

Select experienced borrowers can access up to 100% loan-to-cost on fix-and-flip and new-construction files. This is not universal leverage — ARV caps, sponsor track record, and market liquidity still apply. The 100% financing hub walks through eligibility; most first-time flippers should plan for 10%–15% cash to project.

DSCR stack — stabilized rental permanent debt

DSCR (debt service coverage ratio) loans are the hold leg. At 5.75%–10.5%, they replace bank portfolio debt for investors who qualify on property cash flow, not personal income. Underwriting anchors on as-is appraised value and gross rent — ARV is irrelevant unless you are still in bridge phase.

How DSCR sizing works

Canonical LTV caps for qualified borrowers in select markets:

Transaction	Max LTV
Purchase	Up to 85%
Rate-and-term refi	Up to 85%
Cash-out refi	Up to 80%

Coverage must clear DSCR ≥ 1.0 (often 1.0–1.25 depending on file) against PITIA at the note rate. A property can meet LTV on paper but fail DSCR if rent is thin — the loan amount drops until coverage clears.

Illustrative turnkey duplex:

Line	Value
Purchase / appraisal	$315,000
Target 80% LTV loan	$252,000
Gross rent	$3,400/mo
PITIA at 7.25%	~$2,580/mo
DSCR	1.32

At 80% LTV the file clears. Pushing to 85% LTV ($267,750) drops DSCR to roughly 1.24 — still viable on many desks, but thinner.

How a DSCR loan works · DSCR vs hard money vs conventional

What DSCR is not

DSCR does not fund gut rehabs, vacant purchases with pro forma rent only, or fix-and-flip exits inside 12 months. It is permanent or long-term hold debt on rent-ready collateral. Investors who need speed on distressed acquisitions start in hard money and exit into DSCR after stabilization — the BRRRR sequence.

Stacking hard money into DSCR — the BRRRR path

The most common product stack chains bridge IO → DSCR permanent:

Phase	Product	Rate	Denominator
Acquire + rehab	Hard money IO	8.99%–13.5%	LTC + ARV
Refi after lease	DSCR P&I	5.75%–10.5%	As-is LTV + DSCR

Example: $207,000 all-in, $265,000 ARV, bridge at 90% LTC = $186,300. Post-rehab appraisal $255,000; DSCR at 80% LTV allows $204,000 — bridge payoff fits with ~$17,700 equity left in deal. If appraisal lands at $240,000 instead, 80% LTV = $192,000 and the refi gets tight against a $186,300 payoff.

Model ARV −10% and DSCR at 0.95 before you bind bridge terms. Refi surprise — not rehab overrun — kills most BRRRR stacks.

Choosing the right product — decision framework

Ask three questions before you request a term sheet:

1. What is the exit, and when? Sale within 12 months → fix-and-flip hard money. Lease-up then hold → bridge, then DSCR. Stabilized acquisition → DSCR direct.

2. What condition is the collateral in? Distressed, vacant, or mid-rehab → hard money only. Rent-ready with executed lease → DSCR eligible.

3. Which ratio binds? Hard money: run LTC, as-is LTV, and ARV together. DSCR: run max LTV and coverage at that loan amount.

Investor goal	Start here	Typical rate
Cosmetic flip, 6–9 mo hold	Fix-and-flip IO	8.99%–13.5%
Heavy rehab / BRRRR	Hard money → DSCR refi	IO then 5.75%–10.5%
Turnkey rental purchase	DSCR permanent	5.75%–10.5%
Commercial / MHP bridge	Bridge IO	8.99%–13.5%

Experienced investor solutions · Hard money application process

What to submit for fastest term sheets

Underwriters move files with complete collateral packages — not partial spreadsheets.

Hard money / bridge:

Executed or draft purchase contract
ARV support (sold comps, not active listings)
Itemized scope with contingency
Entity docs (LLC vesting on most files)
Exit pro forma (sale or DSCR refi)

DSCR:

Purchase contract or payoff statement
Rent roll or executed lease
Insurance quote
Entity docs

Purchase contract + ARV comps + scope = fastest 8.99%–13.5% term sheet. Stabilized rental with lease + appraisal = fastest 5.75%–10.5% DSCR quote.

Experienced sponsors with documented sold comps may qualify for streamlined appraisal paths on select hard money files — but ARV still requires third-party support before draws release. DSCR files always require as-is appraisal or BPO tied to the permanent note amount.

Carry math — why product choice affects net profit

Interest-only hard money carry is simple: loan balance × annual rate ÷ 12. A $182,700 balance at 10.5% runs $1,599/mo whether the property is mid-rehab or sitting vacant. Add taxes, insurance, utilities, and a one-month slippage buffer before you underwrite spread.

DSCR carry is fully amortizing PITIA — higher monthly outflow than IO on the same balance, but you are buying a 30-year hold asset, not a six-month trade. Compare products on hold-period cost, not headline rate alone. A 10.5% IO bridge for nine months often costs less total interest than a mis-timed DSCR refi that fails coverage and forces a rate buy-down or cash-in at closing.