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Hard Money Loans — Lendia California

What Are Typical Hard Money Loan Rates and Fees?

Hard money loans carry significantly higher rates and fees than conventional or Non-QM financing — a reflection of the speed, flexibility, and risk tolerance they offer. Here is what California borrowers should expect.

Interest Rates

Hard money rates in California typically range from 9% to 13%+ depending on:

LTV ratio — lower LTV generally means a lower rate
Property type and condition
Borrower experience and credit
Loan amount and term
Current market conditions

Points (Origination Fees)

Hard money lenders typically charge 2–4 points (1 point = 1% of the loan amount) as an origination fee. On a $500,000 loan, 3 points = $15,000. Points are typically paid at closing.

Other Fees

Underwriting/processing fees: $500–$2,000 typically
Appraisal or BPO fee
Title and escrow fees
Draw fees (for construction or rehab loans where funds are disbursed in phases)
Extension fees if the loan term is extended past the original maturity date

Why the Cost Is Often Worth It

On a 6–12 month fix and flip project, the higher rate has limited impact on total cost because the loan is outstanding for a short period. The bigger risk is missing a deal entirely by trying to use slower, cheaper financing. Speed and access often outweigh cost.

Typical Range9%–13%+ interest rate, 2–4 points origination. Hard money is expensive but provides speed and access that conventional financing cannot match.

Adding up the full cost (illustrative example, not a quote)

Take a $500,000 loan at 10% interest-only for 9 months, with 3 points and a $1,000 processing fee. Interest is $37,500 ($500,000 × 0.10 × 9 ÷ 12), assuming the full amount is outstanding the whole time. Points are $15,000 (3% of $500,000). Add the $1,000 fee for $53,500 in total, about 10.7% of the loan amount. Appraisal, title and escrow charges come on top. The rate in the example sits within the 9%–13%+ range on this page and is not a current offer.

Fees to find on every term sheet

Origination points and whether they are paid in cash or deducted from proceeds
Interest calculation: on the full loan or only on funds drawn
Underwriting or processing fees
Appraisal or broker price opinion fees
Title, escrow and recording charges
Draw or inspection fees on loans with renovation funds
Extension and payoff-related fees

Comparing two offers fairly

Do not compare headline rates alone. Total each offer over the same number of months, as in the example above, and include points and fees. A lower rate with higher points can cost more on a short loan; a higher rate with lower points can cost more on a longer one. The shorter your hold, the more the points matter.

Frequently asked questions

Are points negotiable?

Sometimes. Experience, loan-to-value and loan size can influence pricing. We compare options across the lenders we work with and review the trade-offs with you.

Is interest charged on the full loan from day one?

On loans that include renovation funds, interest generally applies to the balance outstanding. On a loan fully funded at closing, it applies to the full amount. Confirm which applies in your term sheet.

Can I finance the points into the loan?

This varies by lender and program. Ask whether fees can be deducted from proceeds, and plan your cash to close on the conservative assumption that you will pay them.