The Quick Read: It depends on loan size, leverage, and lender, but the biggest single fee is origination points, which market surveys put at roughly 2% to 6.5% of the loan, paid in cash at closing, with lender flat fees, third-party closing costs, and any extension charges stacking on top. The total is a stack of line items, not one number. Compare lenders on total dollars paid, not on points alone.
- Points are a percentage of the loan amount, so a larger loan means larger fee dollars.
- Lender flat fees (underwriting, processing, document prep) and third-party costs (appraisal, title, recording) come on top of points.
- Extension fees and minimum-interest terms can make waiting the most expensive choice.
Hard money is a business-purpose loan: short-term, interest-only, and underwritten mainly on the property, the plan, and the exit. Across the programs Lendmire places files with, terms run 6 to 18 months, loans go up to $5,000,000, and the programs carry no prepayment penalty. Fees, leverage, and credit requirements vary by lender, property, and experience, and nothing here is a commitment to lend.
What this loan actually costs to carry.
Hard money is sized against the project and priced by time. Enter the deal and see how much the program will lend, the cash required at closing, the carry while you hold it, and what is left at the exit.
Leverage tiers on the current program: 85% with fewer than 2, 90% with 2 or more, 93% with 5 or more completed projects — every tier capped at 75% of after-repair value. Loan amounts up to $5,000,000, larger by exception; terms of 6 to 18 months, interest-only, no prepayment penalty. The rehab portion funds in draws against completed work, not at closing.
Program parameters shown update from Lendmire’s centralized guideline source. Rate, points, and months are editable assumptions, not quoted terms.
Cost cap sets the loan · positive spread
Illustrative estimate only — not a quote, Loan Estimate, approval, or commitment to lend. Rate, points, and months are editable assumptions. Hard money is business-purpose financing for real estate investors, not a consumer mortgage. Leverage on the current program tops out at 93% of project cost for investors with a documented track record, capped at 75% of after-repair value, with rehab funding up to 100% of the documented budget released in draws; actual terms vary by lender, borrower experience, property, and exit. Lendmire is a mortgage broker, not a lender.
Which “Hard Money Refinance” Do You Mean?
The phrase covers two different transactions, and mixing them up is the fastest way to misjudge your costs.
Scenario A: refinancing into a hard money loan. You own a property and want short-term money against it, perhaps to fund a rehab or to bridge until a sale. The fees are points, lender fees, and third-party closing costs. On the programs in Lendmire’s network, a cash-out or no-cash-out hard money refinance tops out around 65% of the property’s value, which also caps how large the fee base can get.
Scenario B: refinancing out of a hard money loan. This is the exit most rehab investors plan from day one. You finish the project, stabilize the rental, and replace the bridge with long-term financing such as a DSCR loan. DSCR stands for debt service coverage ratio, a check of whether the rent covers the full monthly payment. Your cost here is the payoff of the old loan plus the closing costs on the new one.
Most investors reading this are living in Scenario B. The two sections below cover the entry-side fees first, then the exit.
The Full Fee Stack on a Hard Money Loan
A hard money loan carries six layers of cost. Points get the attention, but the other five decide whether one quote beats another.
| Fee | Paid to | How it is set | Negotiable? |
|---|---|---|---|
| Origination points | Lender | % of loan amount | Often, with track record |
| Underwriting, processing, doc prep | Lender | Flat dollar charges | Sometimes |
| Draw or inspection fees | Lender or vendor | Per draw on rehab loans | Rarely |
| Appraisal, title, escrow, recording | Third parties | Set by vendor and location | Seldom |
| Broker fee, if used | Broker | Percent of loan | Disclose and compare |
| Extension, minimum interest | Lender | Written into the loan | Before signing |
Real Estate Bees reports underwriting fees of $500 to $5,000 and says a broker involved in the loan usually charges a further 1% to 3%. It also says underwriting fees should be negotiable for successful investors. Those figures describe the broader market, not Lendmire’s network, where fees vary by lender, property, and borrower experience.
When a broker arranges the loan, that compensation is a real line item. It should appear in writing before you commit, and you should weigh it alongside every other fee.
Points, Explained
A point is 1% of the loan amount. Two points on a $100,000 loan is $2,000, paid in cash at closing, on top of interest and other fees. That is a simple illustration of the math, not a quote.
In hard money, points and the origination fee are the same thing. That differs from a long-term mortgage, where borrowers may pay an optional upfront fee to lower the cost of borrowing. Hard money points are not optional. They are the price of the loan.
Two details change what points cost you in practice:
- Loan size. Small loans often carry a flat minimum fee, which pushes the effective percentage higher than the posted number.
- Track record. Lenders price experience. A borrower with several completed projects typically gets better leverage and better terms than a first-timer, which is why Lendmire’s network ties its top leverage tier to documented completed projects.
Points are cash due at closing, not a financed cost. For a BRRRR investor (buy, rehab, rent, refinance, repeat), that matters because every dollar spent on fees is a dollar you cannot recycle into the next deal.
What Third Parties Charge
Third-party costs go to vendors, not to your lender. They include the appraisal, title search and insurance, escrow or closing agent fees, legal review, and recording charges.
Your lender cannot discount these, and they move with property type, location, and loan size. The appraisal deserves special attention in a refinance. The lender orders its own appraisal, and its value, not your after-repair estimate, sets how much you can borrow. If the appraisal comes in light, the loan shrinks, and the fees you already paid stay paid.
The Cost of the Loan You’re Leaving
Costs on the old loan are the most overlooked part of the exit. A payoff statement from your current lender is the document that shows them, and you should request it before you commit to a refinance.
Look for four things on it:
1. Outstanding principal. The balance you borrowed, less any amounts not yet drawn.
2. Accrued interest. Interest builds daily or monthly on short-term loans, so each week of delay adds to the payoff.
3. Exit or payoff fees. Some lenders charge them.
4. Minimum-interest terms. Some loans require a minimum number of months of interest even if you pay off early.
The programs Lendmire places hard money files with carry no prepayment penalty, but that is not universal across the market. Read your existing loan agreement for early-payoff terms before you plan an exit date.
Then there are extension fees. If the project runs long and the loan matures before you refinance, extensions usually cost extra. Waiting for a seasoned appraisal or a delayed permit can turn a planned exit into a paid extension. Investors who start the exit process well before maturity avoid most of that cost.
Exit Costs: Refinancing Into a DSCR Loan
The new loan has its own closing costs: lender or broker fees, an appraisal, title and escrow, and recording. The number that tells you whether the exit works is cash to or from closing:
Cash back = new loan − bridge payoff − new closing costs.
If that number is negative, you bring cash to the table. That happens more often than investors expect, especially when the appraisal lands below the after-repair estimate.
Here is how the DSCR side usually looks across the lenders in Lendmire’s wholesale network, always subject to lender guidelines:
- Cash-out leverage: tops out around 75% LTV on standard rentals. LTV is loan-to-value, the loan as a share of the appraised value.
- Seasoning: about 6 months is the common expectation. Seasoning is the waiting period a lender wants between buying or rehabbing a property and refinancing it.
- Coverage: 1.00 is where many select programs start, and stronger ratios open better pricing and leverage. A separate select-lender path goes below 1.00, with leverage and terms adjusted.
- Credit: a 620 floor exists in parts of the network, most programs want around 660, and 700 or more unlocks the strongest tiers.
- Reserves: commonly around 6 months of PITIA, meaning principal, interest, taxes, insurance, and association dues. This varies by lender, leverage, and loan size.
DSCR lender review runs primarily on property-level rental income covering the payment, subject to lender guidelines. Clearing 1.00 is not the same as positive cash flow, because repairs, vacancy, management, and utilities sit outside the calculation.
Many investors refinance out of hard money into long-term DSCR financing once the property is stabilized, and Lendmire brokers that path. For a deeper look at the mechanics, see Lendmire’s guide How to Refinance Out of Hard Money at Cost and Cash Out Later or the two-step approach to paying off hard money with a DSCR cash-out. The complete DSCR loans guide covers the full program picture.
A note on disclosure forms
DSCR loans are designed for non-owner-occupied investment properties. Because they are business-purpose investor loans, they are reviewed differently from a standard owner-occupied mortgage. Consumer disclosure rules, such as the Loan Estimate requirements for covered consumer-purpose loans, do not apply to them, and a law-firm practice guide lists business-purpose rental transactions among the loans exempt from RESPA. The practical consequence is simple. You should not assume a standardized fee form will arrive, so ask for a written term sheet and a full fee schedule up front, and read both line by line.
Is It Worth It? The Break-Even Test
Every refinance has a break-even point, the month when your savings have repaid what the refinance cost.
Break-even months = total refinance costs ÷ monthly savings.
Total costs mean everything: new-loan fees, third-party costs, any payoff or extension charges. Monthly savings is the drop in your carrying cost after you leave the bridge. Hard money is interest-only on a short clock, so staying past the point where the property is stabilized usually costs more than paying the exit fees.
Use the formula in both directions. If the break-even lands far beyond the time you plan to hold the property, the refinance may not pay for itself. If you are close to maturity, compare it against the cost of an extension, because a paid extension followed by a later refinance means paying twice.
Repeating the cycle also multiplies costs. Two refinances mean two appraisals, two sets of closing costs, and extra carry between them. An illustrative calculator on the site can help you lay these items side by side, but it is an estimate, not a quote.
What Changes the Total
| Factor | Effect on cost |
|---|---|
| Loan size | Fee dollars scale up; small loans hit flat minimums |
| Leverage tier | Higher leverage usually costs more |
| Borrower experience | Track record can improve terms |
| Timing | Waiting past maturity adds extension fees |
| Seasoning | Too early can shrink the new loan |
| Appraisal result | Low value cuts loan size, not fees |
| Exit loan type | DSCR fees differ from bridge or conventional |
One caution on comparisons. Closing-cost figures for consumer mortgage refinances do not transfer to hard money. Those pages describe owner-occupant loans with a different fee structure, and hard money points alone often exceed them.
How to Compare and Negotiate Fees
Treat the first quote as a starting point, because several lines are negotiable and some are not. Use this list when you compare offers:
- Ask for every fee in writing, including lender flat fees, draw charges, and extension terms.
- Total the cash due at closing for each offer, not just the points.
- Confirm whether an early-payoff or minimum-interest term exists.
- Ask what repeat or experienced borrowers receive, since pricing often improves with completed projects.
- Ask whether a credit-line structure applies. Paying the origination once on a reusable line can spread the cost across several deals.
- If a broker is involved, ask for their compensation in writing and weigh it with the rest.
A lender with higher points and no flat fees can cost less than one with lower points plus several admin charges. Only the full total shows which is cheaper.
Tax treatment can depend on how the funds are used and how the property is held; investors should keep clear records and speak with a qualified tax professional before relying on any deduction.
Key Terms Defined
Origination fee: the lender’s charge for creating the loan, which in hard money is the same as the points.
Payoff statement: the document from your current lender showing exactly what you owe to close the loan.
Seasoning: the waiting period a lender wants before it will refinance a recently bought or rehabbed property.
Extension fee: a charge for keeping a short-term loan open past its maturity date.
DSCR: the ratio of a property’s rent to its full monthly payment.
Frequently Asked Questions
Are points paid in cash or financed?
Points are generally paid in cash at closing. Market surveys describe them as an upfront cost rather than a financed one, which is why they reduce the cash you can reuse on the next project.
Is there a penalty for paying off a hard money loan early?
It depends on the loan. The programs Lendmire places hard money files with carry no prepayment penalty, but other loans may include a minimum-interest period. Check your existing agreement before setting an exit date.
What happens if my loan matures before I refinance?
You will usually need an extension, and extensions typically cost extra. Start the exit process well ahead of maturity so a delayed appraisal or seasoning period does not force a paid extension.
Can I refinance before the rehab is finished?
Sometimes, but it is risky. The new lender appraises the property as it stands, so unfinished work can lower the value and shrink the loan. A DSCR refinance generally expects a completed, rentable property and a seasoning period of about 6 months in most of the network.
Can fees be rolled into the new loan?
Sometimes. The new loan can cover payoff and closing costs, but only within its leverage cap, so every dollar financed reduces your cash back. If the appraisal comes in low, you may need to bring cash.
If you are buying, rehabbing, or refinancing an investment property on a short timeline and want to see how the numbers work, Lendmire can help you compare hard money options based on the project, the exit plan, leverage, and your goals.
For current guidelines and terms, see Lendmire’s DSCR loan programs page.
About Lendmire
Lendmire is a non-QM mortgage brokerage (NMLS# 2371349) arranging DSCR investor loans in 41 markets, including Washington, D.C. DSCR eligibility is generally reviewed around property-level rental income rather than personal income, subject to lender and program guidelines, a fit for self-employed investors and LLC-owned portfolios. Lendmire was recognized as a Scotsman Guide Top Mortgage Workplace in 2025 and 2026.
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References
1. Real Estate Bees: How Much Does a Hard Money Loan Cost
2. CFPB: TILA-RESPA Integrated Disclosure FAQs
3. McGlinchey Stafford: Consumer Financial Services, RESPA/TRID chapter excerpt
This article is part of Lendmire’s hard money loan program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: 5 Myths About the Risk of a DSCR Cash-Out Refinance · Hard Money Exit vs DSCR Lock-In for a BRRRR Rehabber · How Much You Can Borrow for a DSCR Loan on Condo Properties?
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
- Mortgage Loan Originator · NMLS# 1129696 · Verify on NMLS Consumer Access
- North Carolina Real Estate Broker · License# 343312 · Verify on NCREC
- North Carolina Insurance Producer · License# 19053198 · Property, Casualty, Life, Health · Verify on NAIC SBS
- Lendmire LLC · Firm NMLS# 2371349 · Verify firm licensure
Required disclosures. Lendmire (NMLS# 2371349) operates as a licensed mortgage broker, not a direct lender or depository. The discussion in this article is general in nature and should not be relied upon as financial, legal, or tax advice — every investment scenario is unique and should be reviewed by a qualified professional. Any loan inquiry is subject to lender underwriting, and this article is not a commitment to lend or a guarantee of approval. Mortgage rates, loan terms, and program guidelines vary by borrower, property, and state, and may change without notice. Equal Housing Opportunity. Verify licensure at NMLS Consumer Access.