Start with the exit, not the advertised rate
Investor financing should be selected backward from the business plan. A short-term loan can be appropriate for a property that must be purchased and improved quickly, but it creates risk if the sale or refinance cannot occur before maturity. A long-term DSCR loan can fit a stabilized rental, but it normally will not solve a heavy-rehab acquisition on day one. The correct comparison includes leverage, required cash, interest, points, draw mechanics, reserves, prepayment terms, extension rights, and the cost of a delayed exit.
Published ranges are educational, not offers. A lender may adjust leverage and pricing based on property type, location, borrower experience, credit, liquidity, valuation, project scope, and exit strength.
Side-by-side program comparison
| Program | Common use | Typical leverage framework | Typical term | Timing |
|---|
| Hard Money | Texas investors purchasing distressed, off-market, auction, or time-sensitive investment property | Commonly measured against cost, as-is value, or ARV; exact leverage depends on the program and complete file | Often 6–24 months, generally interest-only | A complete, straightforward file may close in roughly 7–14 days; timing is not guaranteed |
| Fix & Flip | Investors buying distressed or value-add single-family and small multifamily to renovate and resell | Up to ~90% of purchase (LTC) and often 100% of rehab; typically capped near 65–75% of ARV | 6–18 months, interest-only | Often 7–14 days once the file is complete |
| Bridge | Investors who need to close fast on a time-sensitive or off-market purchase | Typically up to ~70–80% of as-is value; sometimes measured against stabilized value | 6–24 months, interest-only | Often 7–14 days; faster on clean files |
| DSCR Rental | Buy-and-hold investors financing single-family or small multifamily rentals | Typically up to ~75–80% LTV on purchase / rate-and-term; often slightly lower for cash-out | 30-year fixed, ARM, and interest-only options | Often 3–4 weeks; no personal income documentation required |
| New Construction | Builders and investor-developers doing infill and spec construction | Often up to ~80–85% LTC (sometimes 100% of vertical); capped near 65–70% of completed value | 12–24 months, interest-only, draw-based | Longer than a rehab loan; budget, builder, and plans drive timing |
| Portfolio | Buy-and-hold investors with 5+ rentals who want one loan and one payment | Typically up to ~75% LTV across the pooled properties | 30-year and interest-only, DSCR-style options | One closing for the whole pool; timing scales with property count |
| Cash-Out Refi | Investors sitting on equity in a rental or stabilized property who want to redeploy it | Typically up to ~70–75% LTV for cash-out on investment property | 30-year, ARM, interest-only, and short-term bridge options | Long-term DSCR cash-out often 3–4 weeks; bridge cash-out faster |
| BRRRR | Buy-and-hold investors who want to recycle the same capital across many deals | Rehab loan often up to ~90% purchase / 100% rehab (capped vs ARV); DSCR refi typically up to ~75% LTV | Rehab loan 6–18 months interest-only; DSCR refi 30-year and interest-only options | Rehab loan often 7–14 days; DSCR refi after the property is rented and seasoned |
Three questions that narrow the choice
1. Is the property stabilized today?
If the property is rent-ready and produces enough income to support the payment, long-term DSCR or portfolio financing may fit. If it is vacant, damaged, mid-construction, or otherwise unable to qualify for permanent debt, short-term bridge or rehab capital may be needed first.
2. Where does the loan get repaid?
A sale exit depends on completed work, market demand, and disposition timing. A refinance exit depends on completed value, seasoning, occupancy, rent, DSCR, credit, and permanent-loan guidelines. A credible exit should be documented before the short-term loan closes.
3. How much cash must remain after closing?
Required equity is only one part of the cash need. Investors should also account for closing costs, lender and broker fees, interest carry, taxes, insurance, utilities, draw timing, construction overruns, reserves, and extension costs.