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Private hard money loans · California

California hard money loans: rates, terms, LTV and requirements explained

When a deal doesn’t fit a bank’s guidelines and approval isn’t an option, HanoverMC steps in. HanoverMC is a private money mortgage company that arranges private, business-purpose real estate financing throughout California through private trust deed investors, including business purpose 1st, 2nd, and 3rd trust deeds and owner-occupied properties when the loan is business purpose. HanoverMC looks at the whole picture of your deal, with the property carrying the most weight and light documentation.

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Underwriting

HanoverMC underwrites every loan it arranges and orders custom California loan documents for each transaction. HanoverMC works efficiently to keep deals on schedule, working closely with title, appraisal, and trust deed investors to avoid unnecessary delays.

Note: HanoverMC cannot guarantee a closing time, but does its best to move every deal forward efficiently.

Borrower FAQ

Here's what real estate investors actually need to know before borrowing — straight answers, no jargon.

What is a hard money loan, and how does it work in California?

Hard money vs. conventional loans — what's the real difference?

Conventional loans are underwritten around you: credit score, income, debt-to-income ratio, and a stack of documentation. Approval can take 30 to 60 days.

Hard money flips that priority. The property's value and your exit strategy matter more than a credit score. That trade-off buys you speed, fewer documentation hurdles, and access even with credit challenges or unconventional deals — at the cost of a higher rate and origination points, since the lender is taking on more risk over a shorter term.

What credit score do you need?

There's no universal cutoff. Many hard money lenders will work with borrowers who have credit issues, as long as there's a clear exit strategy — and HanoverMC arranges financing with trust deed investors who take the same approach. Most still pull credit, usually to confirm identity and flag open judgments, not to enforce a minimum score.

How fast can it close?

Many hard money loans close within 2 to 4 weeks once title work and the appraisal are complete. Business purpose owner-occupied deals and more complex transactions typically take longer.

Actual closing times vary based on property type, documentation, and title or appraisal turnaround, and HanoverMC cannot guarantee a closing time. Ask for a current timeline estimate on your specific deal.

Hard money loan costs, LTV and closing times: California borrower FAQ

What do rates and points actually cost?

Pricing varies by property type, loan-to-value, loan amount, lien position, and exit strategy. Hard money pricing is higher than a conventional mortgage, reflecting the risk and short term. Points (origination fees) can run 1 to 3 percent on HanoverMC transactions, though loans under $250,000 are priced under a special structure.

Every deal is priced individually. HanoverMC arranges term loans and bridge loans with no upfront fees; broker fees and closing costs apply at closing. Request a quote for pricing on your specific deal.

What do LTV, LTC, and ARV mean, and how much down payment do I need?

Many lenders base the loan on ARV rather than as-is value. Across the industry, hard money LTV typically tops out between 60 and 75 percent depending on the lender and property type, so borrowers should plan on bringing meaningful equity to the table, often 10 to 35 percent of the purchase or project cost. HanoverMC generally considers financing up to 70% LTV on 1–4 unit properties and up to 65% LTV on commercial properties, with land evaluated case by case, and CLTV generally capped around 65%. All leverage is based on a formal appraisal. See current guidelines on the hard money loans page, or get exact numbers through a quote request.

Is hard money only for fix-and-flip investors?

No. Common uses include bridge financing between property purchases, ground-up construction and land financing, commercial real estate acquisitions, rental property purchases where timing matters, and deals that don’t fit conventional credit or documentation requirements. HanoverMC arranges business purpose 1st, 2nd, and 3rd trust deeds across a wide range of property types, from small-balance commercial to investment residential. See the full breakdown of hard money loan programs.

Is a mortgage broker different from a direct lender?

Yes, and it’s worth understanding. A direct lender underwrites and closes the loan in its own name, funding it from its own capital or a line of credit, and often selling the loan to trust deed investors afterward. A broker instead matches your deal with private trust deed investors willing to fund it directly.

HanoverMC is not a direct lender. Hanover Mortgage Company (DBA HanoverMC) is a private money mortgage company that arranges private, business-purpose real estate financing throughout California through private trust deed investors, including first, second, and third trust deed financing. HanoverMC underwrites every loan it arranges and orders custom California loan documents. Rather than being limited to one lender’s guidelines, HanoverMC has cultivated a network of qualified, accredited trust deed investors who actively seek to fund the loans it underwrites.

What happens if I can't repay on time, and are there prepayment penalties?

Hard money loans are short-term by design, so you need a clear exit strategy, such as a sale, refinance, or another repayment source, lined up before you close. Missing the term can mean extension fees or a rate increase, so ask about extension options before you sign, not after. On the other end, prepayment terms vary by lender. Loans arranged by HanoverMC carry no prepayment penalty, so you can pay off early without a fee if you finish a flip ahead of schedule. HanoverMC structures loan terms, including balloon and amortization schedules, to match your timeline. See the term loans page for current structures.

The bottom line

Hard money buys you creativity and flexibility that conventional financing can’t match, at the cost of a higher rate and a shorter runway to repay. Before you borrow, get clear answers on rates, points, LTV/LTC/ARV calculations, prepayment terms, and how your broker or lender is structured. HanoverMC has arranged private hard money financing across California for years, with no upfront fees and no prepayment penalties; broker fees and closing costs apply at closing.

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Hanover Mortgage Company arranges private, business-purpose mortgage financing for property owners and investors throughout California, evaluated on the asset and available equity rather than income or DTI. HanoverMC does not fund loans directly — capital comes from private trust deed investors, with financing arranged under HanoverMC’s California DRE broker license.

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