Hard money loans are a popular financing option for real estate investors and borrowers who need quick access to capital. Unlike traditional bank loans, these loans are secured by real estate assets and have more flexible approval processes. However, they come with higher hard money loan rates.

If you're considering a hard money loan in 2025, understanding hard money loan rates can help you make an informed decision.

Hard Money Loan Rates California

Hard money loan rates in California typically range between 9% and 13% annually, depending on factors such as loan-to-value (LTV) ratio, borrower experience, and property type. Due to the competitive market, lenders may offer more favorable terms for lower-risk deals or experienced investors.

California remains one of the most active markets for hard money lending, given its high property values and dynamic real estate sector.

Average Hard Money Loan Interest Rates

Hard money loan rates fluctuate based on market conditions, lender policies, and borrower risk factors. In 2025, national average interest rates for hard money loans typically range from 8% to 14%.

However, the specific rate a borrower receives depends on several factors, including loan type, lender competition, and property location.

Hard Money Loan Rates Per Loan Type

Different types of hard money loans have varying interest rates based on risk level, demand, and lender policies:

Bridge Loans: Interest rates for bridge loans typically range from 8% to 12%. These short-term loans help real estate investors and property owners secure financing quickly while waiting for long-term funding.
Fix-and-Flip Loans: Fix and flip loans interest rates generally fall between 9% and 14%. Due to the higher risk involved with flipping properties, lenders charge slightly higher interest rates.
Commercial Hard Money Loans: Hard money loan rates for this type of loan vary from 7.5% to 12%, depending on the property type and borrower experience. Larger deals may have slightly lower rates due to increased collateral value
Residential Hard Money Loans: Residential hard money loan rates range from 9% to 13%, with rates influenced by the property’s condition, borrower creditworthiness, and exit strategy.

How Lender Competition Affects Rates

The level of competition among hard money lenders plays a significant role in determining interest rates.

In areas with a high concentration of private lenders like California, borrowers may find more competitive rates and flexible terms. Additionally:

Established Lenders vs. New Lenders: Well-known lenders with strong track records may offer slightly lower rates, while newer lenders might charge higher rates to offset risk.
Market Conditions: During periods of high real estate activity, lenders may lower rates to attract more borrowers. Conversely, in uncertain markets, rates tend to rise.
Borrower Negotiation: Borrowers who can demonstrate a strong repayment plan, lower LTV, or extensive real estate experience may have leverage to negotiate better rates.

How to Calculate Monthly Payment on a Hard Money Loan

Calculating the monthly payment on a hard money loan depends on the loan amount, interest rate, and repayment structure. Most hard money loans are interest-only, meaning borrowers pay only the interest each month and repay the principal at the end of the term.

Example Calculation on a Hard Money Loan:

If you take out a $500,000 loan at a 10% annual interest rate, your monthly payment would be:

(Loan Amount x Interest Rate)

12

($500,000 x 10%) / 12 = $4,166.67

This means you would pay $4,166.67 per month in interest, with the full $500,000 principal due at the end of the loan term.

Hard Money Loan with SDC Capital

Hard money loan rates fluctuate based on market conditions, lender policies, and borrower risk factors. In 2025, rates remain competitive but vary based on location, loan terms, and financial profiles.

If you're considering a hard money loan, it's important to work with a trusted lender who can offer competitive rates and flexible terms.

At SDC Capital, we specialize in providing tailored hard money lending solutions to meet your real estate financing needs. Whether you're investing in fix-and-flip projects, purchasing commercial properties, or need a bridge loan, we offer fast approvals and expert guidance.

Ready to get started? Contact SDC Capital today to explore your loan options and secure the best hard money loan rates for your next investment.