Hard Money, Fix and Flip
Hard money is fast because it skips what a bank spends months on.
That speed is not free, and you should know the price before you sign.
Busy Bee Services places fix and flip financing with lenders who underwrite the property and your exit, not two years of tax returns. Purchase or cash out refinance, funded nationwide, minimum loan $100,000.
The mechanics
What a hard money loan actually is
A hard money loan is asset based. The lender is underwriting the property and the deal built around it, not primarily your income history. That is what lets it close in weeks instead of months, and it is also what makes it cost more than a bank loan.
Short term is the other half of the definition. These are not thirty year loans. A hard money loan is a bridge: money to buy and fix a property, or to pull cash out of one, that carries you until you sell it or refinance into something built to be held long term. Using hard money as a stand in for a permanent mortgage is the wrong tool for the job, and the rate makes sure you feel it every month it sits on the property.
The tradeoff is simple to state and easy to underestimate. Speed and a light underwriting file cost more per month than a conventional loan does. Programs available through Busy Bee Services start at 6%, and that is the floor, not the number every file gets.
Fix and flip, by the numbers
What the loan can cover
Every figure here is a lender program range. What a specific file gets depends on the property, the numbers, and the underwriting.
The number that runs the file
ARV drives the loan, not your income
After repair value, ARV, is what the property will be worth once the work is done. It is the number a hard money file actually runs on. Both the purchase advance and the rehab advance get sized against it, which is why an honest ARV matters more than a polished application.
Push the ARV higher than the comps support and the math breaks somewhere. Either the rehab draws stop lining up with what the work really costs, or the deal needs more cash at closing than the plan assumed. A realistic comp set and a contractor's scope of work protect a deal more than a strong credit score does.
This is also why the purchase and rehab figures are described as "up to." Up to 80% of purchase price and up to 100% of rehab funds are ceilings a well supported file can reach, not a starting point every file gets handed.
Match the tool to the job
When hard money is right, and when it gets expensive
Speed is worth paying for on some deals and wasted money on others.
Where it earns its rate
A property with real upside after repair and a buyer or a long term loan waiting on the other side of the work. A purchase you would lose to a cash offer if you waited on a bank closing timeline. A cash out refinance that returns your rehab capital so it can go straight into the next deal.
Where it becomes expensive
Holding it past the term because the sale or the refinance ran long. Choosing it out of habit because a bank application feels slower, on a deal with no real time pressure behind it. Borrowing against a margin so thin that the rate decides whether the project ends in a profit or a loss.
Paperwork
Light on income documents, not light on the deal
Minimal documentation means the lender is not asking you to prove a career. It does not mean the lender is not checking the deal.
What's light
- Two years of tax returns are not the starting point here.
- Personal income history carries less weight than the property and the exit.
- Minimal documentation is part of the program by design, and part of why it closes fast.
What still gets checked
- A purchase agreement, or payoff information for a cash out refinance.
- A scope of work with real contractor numbers behind the rehab budget.
- Proof of the cash needed to close and to carry the property.
- Entity paperwork if you are closing in an LLC or corporation.
What actually gets approved
The exit is the real underwriting
A hard money lender is not betting on a year or two of on time payments the way a bank does on a thirty year mortgage. It is betting on how the loan gets paid off: sold to a retail buyer, refinanced into a rental loan once the work is done, or paid down from another closing already in motion.
Say what that plan is, and mean it. A vague exit produces a vague file. A specific, credible exit is often the difference between a lender treating a request as a plan and treating it as a wish.
Name the exit before you apply: sale, refinance, or payoff from another deal. It is one line on the application, and it is the line an underwriter reads first.
Common questions
Before you apply for hard money
What is the real difference between hard money and a bank loan?
A bank loan is underwritten mainly against you: income, credit history, time in the property. A hard money loan is underwritten mainly against the property and the plan to exit it. That is why it can close faster and why it costs more per month while it is outstanding.
Do I need strong personal credit to qualify?
Credit is reviewed, but it does not carry the file the way it does on a conventional mortgage. The property, the ARV, and the exit plan matter more. Documentation on the income side is minimal by design.
What is ARV and why does it decide the loan amount?
ARV is after repair value: what the property is worth once the renovation is finished. Purchase and rehab advances are sized against that number, so an accurate ARV, backed by real comps, is what makes the loan amount work.
Can I use hard money to buy and hold a rental long term?
You can start there, but you should not plan to stay there. Hard money is short term financing. A buy and hold plan needs to end in a refinance into a longer term loan once the property is stabilized, not in years of hard money payments.
How fast can a hard money deal actually close?
Fast close is the point of the program, and light documentation is what makes it possible. The exact timeline on any file depends on the property, the paperwork you have ready, and the lender's underwriting.
Does Busy Bee Services lend the money directly?
No. Busy Bee Services places your file with lenders who fund hard money loans. Programs available, rates, and terms come from those lenders and are subject to their underwriting and approval.
Figures on this page, including purchase price and rehab funding percentages, the minimum loan amount, and the starting rate, are third party lender program ranges. They are subject to underwriting and approval, and nothing on this page is an offer or commitment to lend.
Bring us the deal. We will tell you what it can get financed for.
One application, purchase or cash out refinance, no fee to find out where it lands.