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    What Is Hard Money?

    Hard money defined — asset-based, short-term real estate financing for investors. Rates 8.99%–13.5%, LTV, terms, and when to use vs DSCR or conventional.

    Hard money is short-term, asset-based real estate financing secured by the property — not your W-2 income or tax returns. Real estate investors use hard money to acquire, renovate, bridge, or exit deals faster than conventional banks allow.

    The term “hard money” refers to the hard asset (real estate) backing the loan. Underwriting prioritizes collateral quality, after-repair value (ARV), loan-to-cost (LTC), and exit strategy over personal credit and DTI.

    How hard money works

    Hard money lenders evaluate four inputs on every file:

    InputWhat underwriters review
    ARVAppraised or broker opinion of value after renovation
    LTCTotal loan amount ÷ (purchase price + rehab budget)
    Scope of workLine-item budget, contractor bids, draw schedule
    ExitSale, DSCR refi, or bridge to permanent debt

    Typical Jaken Finance Group structure for investment property (2026):

    FeatureHard money
    Interest rate8.99%–13.5% (interest-only)
    Term6–12 months (extensions available)
    LTCUp to 90% on qualified fix-and-flip files
    ARV capUp to 75% after-repair value
    Close speed7–10 business days with complete file

    Compare products: DSCR vs hard money vs conventional · hard money loan statistics 2026 · what is a hard money loan

    When investors use hard money

    • Fix-and-flip — acquire distressed property, fund rehab draws, sell at ARV
    • BRRRR bridge — hold and renovate, then refinance into DSCR at 5.75%–10.5%
    • Auction and off-market acquisitions — close before conventional buyers can qualify
    • Entity-vested deals — finance in your LLC without personal income documentation
    • Gap financing — bridge between acquisition and permanent commercial debt

    Hard money is not a 30-year mortgage replacement. It is transaction-scoped capital for investors who need speed and asset-based underwriting.

    Hard money vs. conventional vs. DSCR

    Hard moneyDSCRConventional investment loan
    Underwriting focusARV, LTC, exitRental income, DSCR ratioW-2, tax returns, DTI
    Close timeline7–10 business days21–30 days30–45+ days
    Rate (2026)8.99%–13.5% IO5.75%–10.5% fixedMarket-dependent
    Best forValue-add, bridge, flipStabilized rental holdLong-term owner strategy
    Seasoning for cash-outN/A (short-term)Select no-seasoning programs6–12 months typical

    Worked example: fix-and-flip in Indianapolis

    Line itemAmount
    Purchase price$165,000
    Rehab budget$45,000
    All-in cost$210,000
    Hard money loan (85% LTC)$178,500 at 10.99% IO
    Sponsor cash in deal$31,500
    ARV (supported by comps)$295,000
    Sale at month 7$285,000 net
    Interest carry (7 months)~$11,400
    Estimated profit~$63,000 before selling costs

    Full program requirements: fix-and-flip loan requirements

    Worked example: BRRRR bridge in Gary, Indiana

    Line itemAmount
    Purchase + rehab$142,000
    Hard money balance$118,000 at 11% IO
    Stabilized ARV$189,000
    Combined rent$2,650/mo
    DSCR refi at 75% LTV, 7.5%$141,750 — capital recycled
    Case studyGary no-seasoning cash-out

    Regulatory context

    Business-purpose investment mortgages on non-owner-occupied property follow a different framework than consumer home loans. The CFPB defines consumer mortgages as those secured by a dwelling the borrower occupies. Hard money on investment property is underwritten on collateral and exit, not household income.

    Some states require licensing for private lenders; Jaken Finance Group operates nationwide on non-owner-occupied investment property from Hoffman Estates, Illinois.

    Nationwide hard money at Jaken Finance Group

    Programs include:

    • Fix-and-flip and heavy rehab with milestone draws
    • Bridge and gap financing before sale or refi
    • DSCR transitions for long-term rental holds
    • Commercial and mixed-use where cash flow supports the stack

    Pre-Qualify · Submit flip scenario · best hard money lenders 2026 · (833) 264-7776

    Extension and maturity — planning the exit before close

    Hard money at 8.99%–13.5% is short-term by design. Ask at term sheet:

    TermTypical range
    Initial term6–12 months
    Extension fee0.5%–1% of UPB
    Extension rate step+0.25%–0.75%
    Max extensions1–2

    Budget 6 months IO reserve on every file — forced extensions erode flip margin fast. Exit paths: sale · DSCR refi at 5.75%–10.5% · bridge to permanent · what is a hard money loan.

    Hard money vs. private money vs. bridge — naming

    TermTypical meaning
    Hard moneyAsset-based, 8.99%–13.5%, 6–12 mo
    Private moneyIndividual lender — terms vary
    BridgeShort-term — may overlap hard money
    DSCRPermanent rental — 5.75%–10.5%

    Private money lenders hub · bridge loans · what is a hard money loan · DSCR comparison blog.

    Rates, terms and conditions offered only to qualified borrowers and are subject to change at any time without notice. Closing times are in business days and commence upon satisfaction of borrower conditions. All loans are subject to asset-based underwriting. Jaken Finance Group only finances non-owner occupied investment properties.

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    Jaken Finance Group, 2300 Barrington Road, Suite 400, Hoffman Estates, IL 60196

    Frequently asked questions

    Does Jaken Finance Group lend nationwide?
    Yes on qualified non-owner-occupied investment property in all 50 states.
    How fast can I close?
    7–14 business days on complete hard money / bridge files; DSCR timelines vary with appraisal and lease documentation.
    What leverage is available?
    Up to 90% LTC on qualified fix-and-flip; DSCR up to 85% LTV purchase and 80% cash-out in select markets for qualified borrowers.

    Ready to fund your next deal?

    Get pre-qualified in minutes. Speak with a lending specialist or submit your scenario online.

    Or call (833) 264-7776