Hard Money Loans vs DSCR Loans: Which Is Right for Your Real Estate Investment?
When speed matters and traditional banks say no, investors turn to alternative financing—most commonly hard money loans and DSCR loans.
While both offer fast funding and flexibility, they serve different purposes and borrower profiles. At QuickLend Capital, we help real estate investors across Brooklyn, Charlotte, Greenville, Savannah, and Texas choose the right product based on strategy, asset type, and timeline.
What Is a Hard Money Loan?
A hard money loan is a short-term, asset-based loan typically used for:
Fix and flip projects
Quick-close acquisitions
Transitional properties needing rehab
Non-cash-flowing or distressed assets
These loans are funded by private lenders like QuickLend Capital—not banks. They're based on the value of the property, not your income or credit score.
Key features of hard money loans:
Fast closings (often 5–10 days)
Interest-only payments
Terms usually range from 6–18 months
Higher interest rates, but fewer underwriting hurdles
Often based on ARV (After Repair Value) for rehab projects
What Is a DSCR Loan?
A DSCR loan is a long-term financing product based on the rental property’s cash flow, not personal income. It’s ideal for:
Turnkey or stabilized rentals
Short-term rentals with strong income
Buy-and-hold investors scaling portfolios
Properties with a DSCR of 1.0 or higher
DSCR loans offer long-term fixed rates, interest-only options, and faster approval than conventional loans—without income docs or W-2s.
Key Differences: Hard Money vs DSCR Loans
1. Loan Purpose
Hard Money Loan: Best for short-term deals like fix and flips, value-add, or distressed property acquisitions.
DSCR Loan: Ideal for long-term rental properties generating consistent cash flow.
2. Loan Term
Hard Money Loan: 6 to 18 months (short-term).
DSCR Loan: Up to 30 years (long-term).
3. Underwriting Criteria
Hard Money Loan: Based on asset value or After Repair Value (ARV), not rental income.
DSCR Loan: Based on property income and DSCR (Debt Service Coverage Ratio), typically 1.0 or higher.
4. Use Case
Hard Money Loan: Flip, rehab, or quick-close purchases.
DSCR Loan: Buy-and-hold rental properties, both short-term and long-term rentals.
5. Closing Speed
Hard Money Loan: Very fast—typically 5 to 10 business days.
DSCR Loan: Fast—typically 10 to 14 business days.
6. Documentation Required
Hard Money Loan: Minimal documentation, no income verification required.
DSCR Loan: No personal income verification, but lease/rent data and DSCR calculation required.
7. Loan Structure
Hard Money Loan: Short-term, interest-only payments.
DSCR Loan: Long-term, fixed or interest-only options available.
Which Loan Is Right for You?
Use a hard money loan if:
The property needs renovation or repositioning
You need to close quickly on a distressed asset
You plan to exit the deal via flip or refinance
Use a DSCR loan if:
The property is stabilized and generating rental income
You’re holding long-term for cash flow
You want a fixed rate with no tax return requirements
Markets Where These Loans Shine
Brooklyn, NY – Hard money loans for brownstone flips; DSCR for 2-4 unit rentals
Greenville & Charleston, SC – Fix and flip deals and build-to-rent transitions
Charlotte, NC – Cash-out DSCR loans for turnkey portfolios
Savannah, GA – DSCR loans for short-term rentals; hard money for historic rehabs
Texas – Mix of bridge, hard money, and DSCR for both flips and rentals
Why Work With QuickLend Capital?
We offer both hard money and DSCR loan options, customized to fit your deal and timeline:
Fast approvals and funding
Up to 90% purchase / 100% rehab (hard money)
Up to 80% LTV (DSCR)
Flexible terms for experienced and first-time investors
Lending in Brooklyn, TX, NC, SC, GA, and more
Still deciding which loan structure fits your deal?
Let QuickLend Capital review your scenario and recommend the right financing strategy—fast, flexible, and built for real estate investors.