Loading
Loading
Los Angeles has one of the most active fix-and-flip markets in California. Investors compete for distressed properties across neighborhoods from Echo Park to South LA, where speed often determines who wins the deal.
Hard money fills the gap when traditional financing can't move fast enough. Most deals close in 7-14 days, letting you beat cash offers or secure properties that won't qualify for conventional loans.
This city rewards investors who can execute quickly on value-add opportunities. Properties needing work sit for days, not weeks, so financing that moves at your speed matters.
LA County's vast inventory means opportunities exist at every price point. Hard money works whether you're buying a $400K starter home in Pomona or a $2M property in Silver Lake.
Hard Money Loans in Los Angeles
Hard money lenders care about the asset, not your W-2. Credit scores as low as 500 can work if the property has solid equity and a clear exit strategy.
Expect to put 20-30% down on most deals. Lenders fund based on after-repair value, typically 65-75% LTV, which means your upfront cash determines deal size.
You need a viable exit plan within 12-24 months. Most lenders want to see either a refinance path to conventional financing or a clear sale timeline with comparable sales data.
Prior real estate experience helps but isn't always required. First-time flippers pay higher rates and often face stricter loan-to-cost limits until they prove execution ability.
Local decision guide
Use this guide to connect hard money loans eligibility, lender expectations, and local market factors before comparing payment options in Los Angeles.
Los Angeles has one of the most active fix-and-flip markets in California. Investors compete for distressed properties across neighborhoods from Echo Park to South LA, where speed often determines who wins the deal.
Hard money fills the gap when traditional financing can't move fast enough. Most deals close in 7-14 days, letting you beat cash offers or secure properties that won't qualify for conventional loans.
This city rewards investors who can execute quickly on value-add opportunities. Properties needing work sit for days, not weeks, so financing that moves at your speed matters.
LA has dozens of hard money lenders, but terms vary wildly. Rates run 8-15% with 2-5 points upfront, and the difference between a good lender and an expensive one costs thousands per month.
Local private lenders often move faster than national shops. They know LA neighborhoods and can underwrite a Boyle Heights property differently than one in Pacific Palisades.
Watch for lender specialization. Some focus on small multifamily, others only do single-family flips. A few won't touch properties under $500K or over $3M.
Construction draws matter if you're doing heavy rehab. Get clarity upfront on inspection requirements and draw timelines, because delays kill flip margins.
Most investors overpay on their first hard money loan because they don't shop rates. We see 3-4 point spreads on identical deals depending on which lender you use.
The cheapest rate isn't always the best deal. A lender who closes in 10 days at 11% beats one who takes 30 days at 9% when you're losing a property.
Budget for the full cost. Hard money runs 12-18% APR when you factor in points, which means a $500K loan costs $5,000-7,500 monthly in interest alone.
Your exit strategy determines loan structure. Planning to sell in six months? Take interest-only payments. Refinancing into DSCR? Make sure your lender allows early payoff without penalties.
Hard money costs 2-3x more than DSCR loans but closes in a fraction of the time. If speed wins the deal, the extra cost pays for itself.
Bridge loans offer similar speed but typically require better credit and more documentation. Hard money works when your financial profile won't clear traditional underwriting.
Construction loans require detailed scopes and contractor bids upfront. Hard money lends against after-repair value with lighter documentation, letting you move faster on opportunities.
Once your flip is done, most investors refinance into DSCR or conventional investor loans. Hard money is acquisition capital, not hold-forever financing.
LA's permit process can stretch timelines, which eats into hard money terms. Factor 2-3 months for permits in many neighborhoods before construction even starts.
Rent control and tenant protections affect exit strategies in parts of LA. Make sure your lender understands if you're buying an occupied property with tenant rights implications.
Property values shift drastically by neighborhood. A hard money lender comfortable with South LA might hesitate on a Venice property due to price volatility and regulation differences.
LA County has specific renovation requirements that impact after-repair value. Unpermitted work, seismic retrofits, and foundation issues can kill a flip if not budgeted correctly.
Most lenders close in 7-14 days with a clear title and property inspection. Some can go as fast as 5 days if you have all documentation ready and the property is vacant.
Many lenders work with scores as low as 500-550. Your score affects rate and terms, but the property's equity and exit strategy matter more than your credit profile.
Yes, but expect stricter terms and higher rates. First-time flippers typically face lower loan-to-cost ratios and may need more cash down or a more experienced contractor.
Hard money runs 8-15% interest plus 2-5 points upfront, totaling 12-18% APR. A conventional investor loan costs 7-9% with minimal points, but takes 30-45 days to close.
Most hard money loans include extension options at 1-2% of the loan balance per month. Plan your timeline conservatively since LA permits and inspections often run long.
Yes, through construction draws based on completed work. Expect inspections before each draw and factor inspection timelines into your project schedule to avoid delays.