How is private (hard money) lending different from a bank loan?

We are asset-based, which means we underwrite the property, its equity, and your business plan rather than your personal income and tax returns. That lets us fund in days instead of the 30 to 60+ days a bank takes, on short interest-only terms built around a flip, refinance, or sale. You pay a higher rate than a bank in exchange for speed, flexibility, and certainty on deals a bank cannot fund in time.

How fast can you close?

Fix and flip and residential bridge loans typically close in 5 to 7 days once we have your basics. Rental (DSCR) loans usually take 2 to 3 weeks because of the appraisal and rent verification, and SBA financing runs 30 to 90 days. The biggest variable is how quickly title, insurance, and your documents come together.

Do you check credit, and is there a minimum score?

We do run credit, but on our asset-based loans it carries far less weight than at a bank, and weaker credit can often be offset with a larger down payment or lower leverage. There is no personal income test on these programs. Credit matters most on long-term rental loans, where we look for a 640 minimum and it affects your rate and leverage.

Do I need to provide income documents or tax returns?

Generally no. Our bridge, fix and flip, and construction loans qualify off the property and your equity, and our DSCR rental loans qualify off the property's rent, so we do not ask for W-2s or pay stubs. We will want to see bank statements or proof of reserves. SBA and conventional investment loans are the exceptions and are fully documented.

What do you need to give me a quote?

Just the basics of the deal: the property address or type, the purchase price or current value, your rehab budget, the loan amount, and your exit plan. We can often pre-qualify you over the phone or through a short application and issue a proof-of-funds letter before you are even under contract.

What is a point, and how do your rates compare to a bank?

A point is an upfront fee equal to 1% of the loan amount, and origination on private loans typically runs 1 to 3 points. Our rates are higher than a bank, generally in the high single digits to low teens depending on the program, because the loans are short, fast, and flexible. When you compare offers, weigh the rate and the points together as your true cost of capital.

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SBA 7(a) vs Conventional Loan

Low down and long amortization, or fewer strings and faster.

For owner-occupied commercial real estate or a business acquisition, the trade-off is leverage versus speed. An SBA 7(a) loan is government-backed, so it allows a low down payment and a long amortization, but it asks for more paperwork and takes longer. A conventional commercial loan is faster and simpler, but usually wants a larger down payment and comes with a shorter term or a balloon. USA Mortgage arranges and places SBA financing through partner lenders.

SBA 7(a)

Government-backed, low down

Conventional CRE

Faster, fewer strings

Down payment

Often around 10%

Typically 20% to 30%

Use of funds

Owner-occupied RE, acquisition, working capital

General commercial financing

Amortization

Up to 25 years

Often 5 to 10 years, may balloon

Backing

SBA-guaranteed portion

Bank holds the full risk

Process

Common questions

Is an SBA 7(a) loan lower-cost than a conventional loan?

The rate is competitive and the down payment is lower, which preserves cash, but SBA loans carry guaranty fees and more closing steps. The real advantage is leverage and a long amortization rather than a headline rate.

Can I use an SBA 7(a) loan for investment property?

SBA 7(a) is for owner-occupied real estate and operating businesses, not passive rentals. For pure investment property, a DSCR or conventional investor loan is the right tool instead.

Related comparisons

Hard Money vs Conventional LoanSpeed and flexibility versus the lowest-cost long-term money.DSCR Loan vs Conventional LoanQualify on the property, or on your personal income.

Still not sure which fits?

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