Hard money lenders in Texas

The Texas market

Texas is the largest hard money market by volume outside California: strong population growth, no state income tax, abundant 1950s–1980s housing stock in need of renovation, and builder-friendly suburbs for infill and build-to-rent. Non-judicial foreclosure keeps lender risk — and pricing — competitive.

Licensing

Business-purpose loans to entities secured by non-homestead investment property are generally outside Texas residential mortgage licensing, which targets consumer loans. Brokers and lenders making loans to individuals on 1–4 unit residences should confirm SML requirements.

Usury and interest-rate rules

Texas usury law (Finance Code Chapters 302–306) is unusually strict — a general ceiling of 18% with higher optional ceilings for commercial loans, and severe penalties for violations. Lenders price Texas deals carefully and often structure fees to stay inside the applicable ceiling.

Foreclosure and lender risk

Texas uses non-judicial foreclosure as its primary method, with a typical timeline of ~41 days minimum; sales on the first tuesday of each month. Non-judicial process lets a lender recover collateral through a trustee sale without a lawsuit, which lowers lender risk and translates into more aggressive leverage and sharper pricing for borrowers.

What is different here

The Texas Constitution (Article XVI, §50) sharply restricts liens on a homestead, so hard money lenders will not lend on an owner-occupied homestead and will require a non-homestead affidavit on investment property. Property taxes are high (often 2%+ of value) — budget them into carry.

Lenders active in Texas

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