Hard Money Loan Rates and Points Explained (2026 Update)
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Key takeaways
- Fix and flip rates cluster between 8.25% and 11.5% in 2026; DSCR rental loans 6%–8%; construction and commercial 9%–13%.
- Points (1–3%) and fees often matter more than rate on a 6-month loan.
- Pricing is driven by experience, credit, leverage, property type, state and the lender’s capital source.
- Always compare the all-in cost over your realistic hold period, not the headline rate.
Current rate ranges by loan type
| Loan type | Rate range | Points | Term |
|---|---|---|---|
| Fix and flip | 8.25% – 11.5% | 1 – 2.5 | 6–18 mo IO |
| Bridge (stabilized) | 8.0% – 11.0% | 1 – 2 | 6–24 mo IO |
| DSCR rental | 6.0% – 8.0% | 0 – 2 | 30-yr |
| Ground-up construction | 9.0% – 12.0% | 1.5 – 3 | 12–24 mo |
| Commercial bridge | 9.0% – 13.0% | 1.5 – 3 | 12–36 mo |
| Sub-620 credit | 10.5% – 14.0% | 2 – 4 | 6–12 mo |
Ranges compiled from published rate sheets of national lenders and broker quotes, October 2026. Advertised “from” rates (some as low as 5.5%–6.5%) apply to top-tier borrowers on low-leverage deals or to DSCR products, not to typical fix and flip loans. See our rates and terms page for the full matrix.
What drives your rate
- Experience tier. The biggest single factor. RCN Capital's published matrix, for instance, moves roughly 150 basis points between a first-time flipper and a 10+ flip veteran.
- Credit score. Bands at 660, 680, 700, 720 and 740 each shift pricing 12–50 bps at most lenders.
- Leverage. Every 5% of LTC or LTARV you give back is worth roughly 25 bps.
- Property type and condition. Heavy rehab, 2–4 units, mixed-use and rural property price higher than a cosmetic single-family flip.
- State. Judicial-foreclosure states (NY, NJ, FL, IL, OH) and strict-usury states (TX) carry a premium.
- Loan size. Loans under $150,000 often carry rate or point minimums; loans over $1 million get negotiated.
- Capital source. Lenders funded by warehouse lines and securitizations price tighter than those funded by high-yield investor notes, but are less flexible.
- Market rates. Hard money moves with the 2-year Treasury and the cost of warehouse credit, lagging by a quarter or so.
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Why points matter more than rate on short loans
On a 6-month hold, 2 points cost the same as 4% of annual interest. Compare two offers on a $300,000 loan held 6 months: Offer A at 9.5% and 2.5 points costs $14,250 interest + $7,500 points = $21,750. Offer B at 10.75% and 1 point costs $16,125 + $3,000 = $19,125. The “higher rate” lender is cheaper by $2,625. The crossover point here is about 9 months; past that, Offer A wins. Run your hold-period scenario in the calculator.
Other fees to compare
- Document/underwriting fee: $995–$2,000
- Appraisal or BPO: $300–$900 (sometimes credited back)
- Draw inspection: $150–$300 per draw
- Extension: 0.5–1 point per period
- Interest on undrawn funds: some lenders charge it, some do not — this alone can be worth 1%+ of total cost on a heavy rehab
- Payoff/reconveyance fees: $100–$500
- Minimum interest (e.g., 3 months guaranteed) on some programs
How to negotiate
Get three term sheets on the same deal and share them. Ask for a point reduction in exchange for a slightly higher rate if you expect a quick exit, or the reverse for a long hold. Offer a larger down payment to drop a tier. Bundle: lenders will sharpen pricing for borrowers who commit to several deals a year or who bring the DSCR takeout to the same shop. And ask about interest on undrawn rehab funds — it is often negotiable even when the rate is not.