Hard Money Loan Rates 2026
What Private Lenders Are Charging for Commercial Real Estate
Hard money loan rates in May 2026 range from 9.00% to 13.00% for commercial real estate, with most deals pricing between 10% and 12%. Hard money lenders trade off higher rates for speed (5 to 15 business days to close), flexible underwriting, and the ability to fund deals that conventional lenders decline. The premium rate is often justified by the cost of a missed acquisition or a distressed purchase opportunity.
Current Rate Table
Rates shown are indicative ranges based on current market conditions. Your actual rate will depend on your specific property, leverage, and borrower profile. Contact Commercial Lending Solutions for a precise quote.
| Leverage Tier | Rate Range | Notes |
|---|---|---|
| Low Leverage (50% to 60% LTV) | 9.00% to 10.50% | Strong equity position, cleanest deals |
| Standard (60% to 70% LTV) | 10.50% to 12.00% | Most common hard money range |
| High Leverage (70% to 75% LTV) | 12.00% to 13.00% | Max leverage, additional collateral may be required |
| Fix and Flip (on ARV) | 9.50% to 11.50% | Based on after-repair value, for experienced sponsors |
Rates are illustrative ranges as of May 2026 and subject to change. All loan programs subject to underwriting approval. Not a commitment to lend.
What Drives Hard Money Loan Rates
Understanding these factors helps you position your deal for the best available rate.
Equity Position and LTV
Hard money underwriting is asset-first. Every 5 percentage points of additional leverage typically adds 50 to 100 basis points. The lender's primary question is: if we have to foreclose, can we recover our loan from a quick sale?
Property Type and Condition
Stabilized income-producing properties get the best rates. Vacant land, raw construction, or highly distressed assets with deferred maintenance push rates to the high end.
Lender Type
Individual private lenders and small family offices often price tighter than hard money funds with institutional capital. Mortgage REITs and bridge debt funds occupy a middle ground between hard money and institutional bridge.
Borrower Experience
A first-time investor pays more than a sponsor with 20 completed flips or repositioning projects. Lenders price in execution risk heavily on hard money.
Exit Strategy
Lenders want a clear and credible exit. A signed purchase contract, an approved refinance commitment, or a clear path to stabilized value reduces perceived risk and improves pricing.
Market Location
Primary markets (LA, New York, Dallas, Miami) attract more lender competition and better pricing. Rural or tertiary markets see fewer lenders willing to lend and higher rates as a result.
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How Hard Money Loan Compare to Alternatives
Choosing the right loan structure can mean a 100 to 300 basis point difference in your cost of capital. Here is how current rates compare across loan types.
| Loan Type | Current Rate Range | When to Use vs Hard Money Loan |
|---|---|---|
| Institutional Bridge Loans | 7.50% to 11.00% | Larger loans ($5M+), more structured underwriting, 2 to 4 week close. Better rate but less flexible. |
| DSCR Loans | 6.50% to 9.00% | Fixed rate permanent solution, but requires stabilized rental income. Not suitable for transitional assets. |
| Construction Loans | 7.50% to 11.00% | For ground-up builds rather than existing asset repositioning. Bank-based construction loans are slower. |
| SBA 7(a) Loans | 7.50% to 10.50% | Owner-occupied properties only, 2 to 3 month close. Cannot be used for pure investment properties. |
Hard Money Loan Rates 2026: Frequently Asked Questions
What are current hard money loan rates?
Hard money loan rates in May 2026 range from 9.00% to 13.00% for commercial real estate, with most deals pricing between 10% and 12%. Rates depend on leverage level, property type, borrower experience, and market location. Low-leverage deals at 60% LTV or below can access rates starting around 9%.
What points do hard money lenders charge?
Hard money lenders typically charge 1 to 3 origination points (1 to 3% of the loan amount) at closing in addition to the interest rate. Some lenders also charge exit fees of 0.50 to 1.0 point upon payoff. Total cost of capital on a 12-month hard money loan including points is typically 12% to 18% annualized.
How fast do hard money loans close?
Hard money loans close in 5 to 15 business days on average. Some private lenders can approve and fund in as few as 3 to 5 business days for experienced sponsors with complete documentation. This speed advantage over conventional financing (45 to 90 days) is the primary reason borrowers accept the higher rate.
Do hard money lenders check credit?
Hard money lenders focus primarily on the property value and equity position rather than the borrower's credit score. Most prefer a minimum score of 600 to 620, but the credit score is a secondary factor. Borrowers with prior foreclosures, bankruptcies, or credit challenges can often obtain hard money financing when conventional lenders decline.
What is the difference between hard money and bridge loans?
Hard money lenders are typically private individuals or small funds with maximum flexibility and the fastest closings, usually under 2 weeks. Bridge lenders are institutional debt funds that offer slightly better rates (7.50% to 11%) and larger loan sizes but require 2 to 4 weeks to close. For deals under $5M needing to close in under 2 weeks, hard money is usually the right tool.
Trevor Damyan is a commercial mortgage broker with $1B+ in loans closed and direct relationships with life insurance companies, CMBS desks, debt funds, and non-QM lenders. Rate data is compiled from active lender conversations and closed transaction experience.
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