The Quick Read: Send every lender the same deal, get each fee in writing, convert every charge into a dollar cost over your realistic hold, and then score the quotes on cost, cash you must advance, and fit with your exit. The advertised price of the loan is the weakest comparison tool, because fees, draw rules, and minimum-interest terms often outweigh it.
- No standard form exists for hard money quotes, so you have to build the comparison yourself.
- Identical deal inputs are the foundation, because leverage figures built on different value bases cannot be compared.
- A point is 1% of the loan amount, so convert every point into dollars before you compare.
- Ask how interest accrues, how draws are funded, and what happens if the project runs long.
- Test every quote against your exit before you sign.
Why Hard Money Quotes Don’t Line Up
Hard money quotes differ in layout, vocabulary, and what they include. One sheet bundles fees into a single line. Another lists six separate charges. A third leaves out the draw inspection fee entirely, so you only learn about it later.
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.
The cause is simple. Hard money is private, asset-based lending for business-purpose investment property. Each lender writes its own term sheet. Nothing forces lenders to use the same labels, the same order, or the same assumptions about when interest starts.
That is why a checklist beats a gut feel. A checklist turns a handful of different documents into one set of answers. Quotes that look close on the surface often split apart once every line has an answer.
Step 1: Send Every Lender the Same Deal
Build a one-page deal summary first. Include the purchase price, the rehab budget, your estimate of after-repair value (ARV), your target closing date, and your exit plan. Give that same page to every lender or broker.
This step does the most work in the whole process. If one lender hears a different rehab budget than another, their advance figures cannot be compared. A strong comparison works like a controlled experiment. The inputs stay fixed, and only the lender changes.
Also decide your realistic hold period before you ask for anything. Pick a base case and a slower case in which the rehab or the sale runs long. You will use both later.
Step 2: Find Out Who Is Funding the Loan
Ask the plain question: is your company the one funding this loan, or do you place it with another lender? Neither answer is wrong. Direct lenders control their own decisions. Brokers, including Lendmire, can reach several lenders and match a project to the one whose guidelines fit best.
The point is to know which one you are talking to. If a broker is involved, ask whether its compensation is itemized separately or built into the lender’s charges. Then ask whether the lender’s own fees are listed on the same sheet.
Ask for the same proof from every party. That means a written term sheet and a full fee schedule. A verbal summary does not count.
The Master Checklist
Use this table as your working document. Fill in one copy for each quote.
| What to ask | Strong answer | Warning sign |
|---|---|---|
| Value basis for leverage | Stated clearly: cost, purchase price, or ARV | Vague, or changes between calls |
| Interest method | Charged on funded amounts only | Charged on the full loan from the start |
| Points and fees | Itemized in writing, each with a purpose | One lump line, or “TBD” |
| Draw process | Fee, minimum size, and turnaround stated | Inspection costs not disclosed |
| Term and extensions | Extension cost and count stated upfront | Extension terms “discussed later” |
| Minimum interest | None, or clearly capped | Interest owed through a set term no matter what |
Run every lender through all six rows. Any blank cell is a question, and a lender who will not fill it in has told you something.
How Leverage Gets Defined
Leverage is where quotes mislead most often. An advance can be a percent of purchase price, a percent of total project cost, or a percent of ARV. The same deal produces three different loan amounts depending on which one the lender uses. When two bases conflict, ask which one controls.
The programs Lendmire arranges show why this matters. Fix-and-flip leverage is measured against project cost, tiered by documented completed projects, and then capped by after-repair value:
- 93% of project cost at five or more completed projects.
- 90% of project cost at two or more completed projects.
- 85% of project cost with fewer than two completed projects.
- Every tier is capped at 75% of after-repair value.
Bridge purchases with no rehab run up to 80% of purchase price. Cash-out and rate-and-term refinances run up to 65% of value. Up to 100% of the rehab budget is funded in draws against completed work. That last figure applies to the rehab budget only, not to the purchase.
All of this varies by lender, property, and experience, and nothing here is a commitment to lend. The takeaway for your comparison is the structure. A high advance on cost can still be limited by the ARV cap. If a quote advertises a big number, ask which cap binds first.
Pay attention to the cash you bring too. A lower advance means more of your own money in the deal, and that money has a cost. A quote with a smaller advance and a better sticker price can still cost you more once you count the equity it demands.
Convert Every Quote Into Total Cost
The advertised interest figure is only one piece. Total cost of capital is the sum of every charge over your hold period, in dollars. To compare quotes with different hold assumptions, divide that sum by the number of months you hold to get a monthly cost. Either way is an arithmetic convention, not a regulatory rule, but it makes quotes comparable.
Work through it in this order:
1. Points in dollars. One point is 1% of the loan amount. Multiply by the number of points quoted, using that lender’s loan amount, and write the dollar result.
2. Fixed fees. Add processing, inspection, appraisal, escrow, and any broker charge. Fixed fees weigh more on smaller loans.
3. Interest over the hold. Ask whether interest runs on the full loan or only on funded amounts. On a rehab loan, that difference can be large, because the rehab portion is drawn gradually.
4. Draw charges. Multiply the per-draw fee by the number of draws your rehab plan needs.
5. Extension and minimum-interest costs. Run your slower case and see what gets triggered.
6. Cash you advance. Contractors often want a deposit before work starts, and reimbursement follows inspection. Count the cash you carry in the gap.
Tax treatment varies by situation, so consult a qualified professional about how any of these costs are treated.
A Quick Worked Comparison
Picture two quotes on the same deal. The inputs below are qualitative on purpose, since they illustrate the method and not any real pricing.
| Factor | Quote A | Quote B |
|---|---|---|
| Sticker price | Looks cheaper | Looks higher |
| Interest accrual | Full loan from start | Funded amounts only |
| Draw fees | Charged per draw | Included in fees |
| Minimum interest | Required | None |
| If project slips | Cost climbs sharply | Cost rises modestly |
In the base case, Quote A may win by a small margin. In the slower case, the full-loan accrual and the minimum-interest term make Quote A the more expensive option, and Quote B comes out cheaper. This is why you run both cases. The quote that wins when everything goes right is not always the quote that wins when the schedule slips.
Score the Quotes, Then Decide
After you have total cost for each quote, add a simple weighted score. Give each quote a rating from one to five on four factors: total cost, cash you must advance, flexibility if the project slips, and exit fit.
Weight the factors by your priorities. An investor with limited cash should weight cash advanced more heavily. A first-time flipper should weight flexibility, since the first rehab usually runs long. An experienced investor with tight margins may put cost first.
The network’s program terms are a useful reference for the flexibility factor. Terms run 6 to 18 months, interest-only, with no prepayment penalty. Those features vary by lender and loan, so confirm each one in writing. A quote with a hard minimum-interest period and a short term deserves a lower flexibility score than one built the way the network describes.
Where the Checklist Breaks
Checklists handle the standard deal. A few situations need extra care.
Lines of credit. Some lenders offer a revolving line to experienced investors. Points may apply once per year on the line, not per deal, with interest only on drawn amounts. A per-deal quote and a per-line quote cannot be compared until you model how many deals you will actually run.
Brokers on top of lenders. If a quote has a broker layered over a lender, make sure both sets of fees appear. Missing one layer makes a quote look cheaper than it is.
Appraisal practices. A lender that skips a full appraisal may value the property conservatively. That can leave you with more cash due at closing than the advance suggested. Ask how value will be determined before you rely on the leverage number.
Construction and temporary financing. Ground-up construction runs on its own structure. The network describes up to 90% of cost and 75% of completed value at three or more completed projects, for builds up to 10 units.
Consumer-purpose loans. This is the one place the rules change the paperwork. Hard money is a business-purpose product for non-owner-occupied residential property of one to four units. Business-purpose loans are reviewed differently from standard owner-occupied mortgages, and they generally do not come with the consumer Loan Estimate form. For that reason, ask for an itemized fee schedule instead of waiting for a standard disclosure.
Business purpose still has limits. Doss Law explains that credit to acquire, improve, or maintain non-owner-occupied rental property is categorically exempt as business purpose. The same guide says a property you expect to occupy for more than 14 days in the coming year can be treated as a consumer loan, unless it has more than two housing units. A Hunton law-firm analysis adds that business purpose does not mean compliance exempt. If any part of your plan involves living in the property, treat the quote differently and talk to counsel.
State licensing. Requirements vary by state. Hard money through Lendmire’s network is available across 41 markets, including Washington, D.C., with some exclusions, and every file is underwritten individually.
Plan the Exit Before You Pick
A cheap bridge loan that does not fit your exit is an expensive loan. Ask each lender how it handles payoff, and whether any seasoning or hold requirements affect your refinance.
Many investors refinance out of hard money into long-term rental financing once the property is stabilized, and Lendmire brokers that path. A refinance is its own test, so check the takeout before you pick the bridge. On the long-term side, most programs in the network want about 6 months of seasoning on a cash-out refinance, and cash-out typically tops out around 75% of value on a standard rental. Those figures vary by lender and property, and your hard money payoff has to fit inside them.
Rent-to-payment coverage matters too. Lenders compare monthly rent to the full payment of principal, interest, taxes, insurance, and any HOA dues. Clearing 1.00 on that ratio does not equal positive cash flow, since repairs, vacancy, and management sit outside it. Lendmire’s complete DSCR loans guide walks through how that ratio works.
For the bridge side, Lendmire has written about how to vet a hard money lender’s draw process. It goes deeper on a point this checklist only touches.
Key Terms Defined
ARV (after-repair value): The estimated value of the property once the rehab is complete.
Loan-to-cost: The share of total project cost, purchase plus rehab, that the lender advances.
Draw: A release of rehab funds after the work is inspected, in line with the lender’s schedule.
Accrual method: The rule for what balance interest is charged on, either the full loan or only funded amounts.
Minimum interest: A set amount of interest owed regardless of how soon you pay the loan off.
Making the Call
The best quote is the one that wins on your own numbers. Often it is not the one with the more affordable sticker price. It is the quote with the fewest unanswered rows, the most predictable cost if the schedule slips, and the cleanest handoff to your exit.
Collect at least three quotes on identical inputs. Use competing quotes to negotiate, because points and fees are often adjustable and a written competing offer gives you something specific to point to. Then, when the closing statement arrives, compare it line by line against the term sheet. Any drift between the two deserves an explanation in writing.
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. You can reach the team at 828-256-2183.
Frequently Asked Questions
How many hard money quotes should I compare?
Three is a practical minimum. That gives you enough spread to see which terms are normal and which are outliers. Going past five usually adds more paperwork than insight, as long as every quote uses the same deal inputs.
Is the interest cost enough to pick a lender?
No. Points, draw fees, minimum-interest terms, and extension charges can outweigh a small difference in the advertised price. Total cost over your realistic hold period, including a slower case, is the number to compare.
What does a point mean in dollars?
One point is 1% of the loan amount. Multiply the number of points by the loan amount that lender is offering, since two lenders rarely quote the same balance. Then find out whether the points are paid at closing or at payoff.
Why do two lenders offer different loan amounts on the same deal?
They may be using different value bases. One may advance a share of project cost and another a share of ARV, and an ARV cap can bind first. Ask which basis controls and how the lender arrives at its value.
What should I do if the closing numbers differ from the quote?
Lay the closing statement beside the term sheet and mark every changed line. Ask the lender or broker to explain each difference in writing. If a charge appears that was never on the term sheet, decide whether the explanation is acceptable before you proceed.
About Lendmire
Lendmire (NMLS# 2371349), a non-QM mortgage broker serving investors in 41 markets including Washington, D.C., places hard money and DSCR loans through wholesale investor lenders and is not a direct lender. DSCR scenarios are commonly evaluated around a property’s rental income rather than personal income paperwork, subject to lender guidelines. A Scotsman Guide Top Mortgage Workplace in 2025 and 2026.
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References
1. Doss Law, Business Purpose Exemption Simplified
2. Hunton Andrews Kurth, Beware of Business Purpose
This article is part of Lendmire’s hard money loan program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: How to Cross-Collateralize Two Properties Under One Hard Money Loan · Blanket Hard Money vs Individual Loans for Five Rehabs · Does a Hard Money Lender Require a Down Payment on a Flip?
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
Important disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage brokerage. Lendmire is not a direct lender, depository institution, or financial advisor. All loan inquiries are subject to lender underwriting; this article does not constitute a commitment to lend. Rates, terms, and program guidelines are subject to change without notice and vary by borrower profile, property type, and state. Information in this article is general in nature and is not financial, legal, or tax advice. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.