How to Get a Hard Money Loan in California

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Securing a hard money loan in California is significantly faster and less complicated than applying for a traditional bank loan.

While banks demand extensive documentation and lengthy underwriting, hard money lenders focus on one key factor — the equity in the property being used as collateral. With minimal paperwork and a streamlined review process, funding can often be completed in under a week.

That said, speed and a simple application process don’t translate into every borrower getting funded. Each hard money lending company has its own slightly unique criteria borrowers must meet, and not every applicant will qualify.

To improve your chances of approval, it’s important to understand exactly what California hard money lenders are looking for in an applicant.

In this article, we’ll break down the essentials, from lender requirements to tips for securing funding quickly.

7 Steps To Get A Hard Money Loan in California

Each hard money lender in California has their own lending requirements; however, here are general steps you can expect to encounter.

Define Your Goal

Ask yourself the following questions;

Exactly how much money do you need?
What will the funds be used for?
For how long do you need the money?
How do you plan to repay the lender?

Are you planning to buy an investment property in Pasadena, refinance a multifamily apartment in Long Beach, or fund renovations in El Segundo?

Hard money lenders want to see a clear, well-defined plan, showing an exit strategy as to how you’ll repay the loan, whether through a sale, refinance, or another method.

You should also determine how much you need to borrow and whether the amount represents a realistic loan-to-value (LTV) based on the property’s current or after-repair value.

Note: Asking for 90% or 100% LTV will almost immediately result in rejection. Most lenders prefer to stay within a maximum LTV range of 65% to 75%, depending on factors such as property location, condition, and the borrower's financial strength.

Prepare Your Documents

While hard money lenders don’t require nearly as much documentation as banks, be prepared to provide proof of property ownership, recent financial statements, identification, a clear title, insurance, and, if applicable, a purchase contract.

Have these documents ready, and you will speed up the approval and funding process.

You can find more tips on how to qualify for a bridge money loan in this article.

Find the Right Lender

Do a Google search for private money lenders or hard money lenders in your <CITY NAME>. For example, “hard money lenders in Los Angeles” will bring up a list of local Los Angeles lenders, along with reviews, how long they have been in business, and their respective loan programs.

Once you’ve narrowed down your top choices, it’s helpful to compare and contrast them across key factors such as:

Interest rates
Fees and Additional Costs
Loan Terms
Repayment Flexibility
Reputation & Reliability
Approval and Funding Speed
Loan-to-value (LTV) ratio

For more background, you can read our guide on How to Find the Best Hard Money Lender in California.

Contact the Lender

Most lenders can be contacted by phone, email, or through an online application form.

Make sure your documents are ready, as they will help you answer any questions the lender may have.

After a brief 5-minute phone call or email, most lenders will inform you on the spot if they are interested and ready to proceed to the next step, or if they are not interested in your project.

Term Sheet

If everything checks out during the initial review and subsequent phone conversations, the lender will provide a non-binding preliminary term sheet that outlines the proposed loan details, such as:

Loan amount
Interest rate
Origination fee
Prepayment penalties
Underwriting fee
Loan term length
Extension options
Rehab draws (for fix-and-flip loans)

Once the borrower reviews and agrees to the proposed loan terms, they’ll sign the term sheet, allowing the deal to proceed to the underwriting and due diligence stage.

Underwriting & Due Diligence

With a signed term sheet, the bridge lender begins their due diligence to assess the feasibility of the investment.

During this process, the lender carefully reviews factors such as:

Loan-to-value (LTV) ratio
Physical condition of the property
Current property value
Property title and, if necessary, title insurance
Proof of insurance
Borrower’s financial strength
Borrower’s real estate experience
A realistic exit strategy
Proposed interest rate
Loan term and potential extensions

After verifying all information, the lender will set a closing date.

It’s important to note that providing false or misleading information on a loan application constitutes loan fraud. If malicious intent is discovered, the lender reserves the right to adjust the loan terms or deny the loan entirely.

Loan Approval

Once due diligence and underwriting are complete, the lender will issue a final decision on whether to approve or deny the loan.

If approved, the finalized loan terms typically outline:

Interest rate
Origination points
Repayment structure
Fees

Lenders may also require additional conditions, such as:

Proof of insurance coverage
Escrow reserves
Property inspections

After the paperwork is finalized, borrowers can usually expect funds to be disbursed within two to three days of approval.

If a borrower decides not to move forward, they can generally withdraw without significant financial consequences, though non-refundable costs like appraisal or inspection fees will still apply.

Once the borrower confirms their intent to proceed, the lender coordinates with the title and escrow company to prepare for closing.

Who Can Get a Hard Money Loan in California?

Anyone can apply for a hard money loan in California, where approval depends primarily on the value of the collateral rather than your credit score.

Here are the most common types of borrowers:

Real Estate Investors

Experienced California real estate investors love hard money because it gives them a leg-up against competing offers relying on time-intensive traditional bank loans. Hard money loans are especially useful for acquiring income-producing assets, expanding investment portfolios, or refinancing existing holdings to free up capital for the next deal.

Developers and Flippers

Developers and flippers also use hard money because it gives them the cash to start construction or rehabs immediately, without waiting on traditional lenders. Remember, time is money. Hard money loans are ideal for fix-and-flip projects, rental property acquisitions, and rehab opportunities where speed and leverage make all the difference.

Borrowers With Imperfect Credit

Hard money loans appeal to borrowers with less-than-perfect credit because approval is based primarily on property equity, not credit history. They offer a practical path to financing for those who’ve faced past financial challenges but still have strong assets or valuable real estate to leverage.

Owners or Buyers of Unique or Distressed Properties

California is full of unique or distressed properties, and hard money lenders are often willing to finance these properties that traditional banks consider high risk. These loans provide a lifeline for owners looking to stabilize, renovate, or reposition properties that banks won’t touch.

Homeowners Needing Quick Capital

Hard money loans can help homeowners bridge the gap between selling their current home and purchasing a new one, without waiting for lengthy bank approvals. They’re especially useful for covering short-term financing needs, securing a new property quickly, or accessing equity before a traditional sale closes.

How NOT To Get a Hard Money Loan

Not every borrower will qualify for a hard money loan, and some situations make approval significantly more difficult. Lenders are looking for deals where both parties share risk, and when certain factors are present, it could be a deal breaker.

Some types of borrowers and loan scenarios are especially challenging, often carrying a higher risk for lenders. Common examples include:

Owner-Occupied Homes

Hard money lenders generally prefer investment properties over primary residences (even if they are in Beverly Hills) because their focus is on the property’s resale or income potential, not on the borrower’s personal need to live there. Additionally, the majority of California hard money lenders don’t have the proper licensing to provide consumer loans on owner-occupied properties, this is an arena typically handled by traditional lenders. So hard money lenders stick to investment deals, where the property itself can secure repayment, minimizing their risk.

Vacant Land and Rural Farmland

Lenders are often hesitant to finance vacant or undeveloped land, including rural farmland, because there’s no structure to generate income, and these property types are viewed as illiquid. In more remote areas of California, like outside Fresno, Modesto, or Redding, the resale market can be smaller and less predictable, property values can be volatile, and there’s often less demand from buyers, all of which increase the lender’s risk and make these loans more complicated and risky to approve.

Highly Specialized or Niche Properties

Hard money lenders are often cautious with properties that appeal to a select buyer pool. Examples include industrial laundromats, specialized commercial buildings, or other unique properties that may be difficult to sell quickly. Because the number of potential buyers is limited, lenders see a higher risk of the property not selling or generating the expected return, making approval for these loans more challenging.

Borrowers Without Clear Exit Strategies

Hard money lenders need to know exactly how you plan to repay the loan, whether it’s by selling the property, refinancing, or generating rental income. Having a primary and secondary exit strategy is a great idea. Without a clear and realistic repayment plan, lenders view the loan as high risk, making approval unlikely and funding difficult to secure.

Borrowers Seeking Unrealistic Loan Terms

Yes, hard money loans are generally more expensive than traditional bank financing—that’s because lenders are taking on more risk and offering faster, more flexible access to capital.

Lenders become particularly cautious when borrowers request amounts that are too high relative to the deal’s risk (like 100% LTV) or ask for unusually low interest rates or extended terms.

In California markets like Los Angeles, San Diego, or the Central Valley, lenders need terms that reflect the property’s risk and potential, so unrealistic expectations often lead to delays or outright rejection.

First-Time Fix-And-Flippers

Inexperienced borrowers without a proven track record are less likely to get approved for a fix-n-flip loan, even in hot markets like West LA or the Hollywood Hills. Lenders want to see evidence that you can successfully manage a renovation project, stay on budget, and sell the property for a profit. If you don’t have the necessary experience, consider partnering with a developer who does; this will substantially increase your chances of funding.

Whether flipping homes in Los Angeles, San Diego, or Santa Barbara, first-time flippers face higher scrutiny in competitive California markets, as lenders view inexperienced borrowers as a greater risk when property values and resale timelines can fluctuate.

Looking for hard money to fund a California fix-and-flip? Visit our dedicated page to learn more.

The Bottom Line

Hard money loans offer California investors, developers, and homeowners fast, flexible, and reliable financing that traditional banks can’t match. From flipping homes in Los Angeles to refinancing commercial properties in San Diego, these loans give borrowers the ability to move quickly and take advantage of timely opportunities.

Successfully securing a hard money loan in California depends on being well-prepared, understanding your borrowing goals, having a clear exit strategy, and providing the necessary documentation upfront. By doing so, you increase your chances of approval and ensure a smoother funding process.

With the right planning and the right lender, you can leverage hard money loans to grow your real estate portfolio, complete renovation projects, or secure investment properties quickly and efficiently.

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