Hard Money Loan Delaware
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Last updated: May 9, 2025
At OfferMarket, we’re dedicated to helping Delaware real estate investors build lasting wealth through smart property deals. Our comprehensive platform is designed to streamline every aspect of your investing journey:
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Our Hard Money Loan Delaware program offers rapid, trustworthy, and competitively priced financing for 1-4 unit residential investment properties—whether you’re buying, refinancing, or fixing up.
If your investment strategy is to flip for a gain or hold and rent with a long-term DSCR loan, we’d be honored to support your path to success.
Let’s walk through what makes the OfferMarket Hard Money Loan Program perfect for Delaware investors.
What is a hard money loan?
A hard money loan is a short-duration real estate-backed loan, secured against 1-4 unit residential property in Delaware. These loans are perfect for funding purchases, refinances, and renovations—whether your goal is a profitable resale or a long-term hold.
Delaware investors might also hear these referred to as “fix and flip loans” or “bridge loans.” While the names differ, the concept is the same: fast, asset-backed lending for investment real estate.
Hard money loan use cases
Delaware real estate investors often turn to hard money loans in situations like:
Buying and renovating an outdated or distressed property to reduce out-of-pocket expenses
Refinancing a property bought with cash—especially if a fast close was required—before starting renovations
Paying off an existing short-term lender while finishing the remaining rehab work
Acquiring a property in as-is condition with no plans to improve it, aiming for a quick turnaround sale
Refinancing a cash purchase to pull out equity for another investment opportunity
Refinancing a finished rehab to get more time to list or rent
How it works
Hard money loans are composed of two core elements:
Initial Advance: This upfront portion goes directly toward your Delaware property purchase and is wired to the title company at settlement.
Construction Holdback: Funds allocated for renovation work. These are reimbursed to you in draws as progress is made.
Many Delaware investors use both components to maximize leverage and limit their own capital exposure. Some prefer just an Initial Advance and self-fund the renovations. Others who buy in cash may only want the construction funds reimbursed.
Your ultimate goal might be to flip or to hold and refinance—what matters is that your strategy stays flexible based on Delaware market trends. For instance, a project intended for the BRRRR method might shift toward flipping if rental demand dips and the resale value looks promising. Or a flip might become a hold if the market cools.
The key is picking projects with multiple viable exit options to reduce risk in any economic climate.
Who uses hard money loans?
Delaware real estate investors from a wide range of backgrounds benefit from hard money loans:
- Fix and flip pros (“flippers”) use them to fund fast-moving projects.
- Buy-and-hold strategists — particularly those leveraging the BRRRR method — rely on them for both acquisition and rehab.
(*) Explore our Fix and Rent bundle: a hard money loan for both purchase and rehab, plus a discounted DSCR loan for the refinance.
Many successful investors in Delaware don’t limit themselves to just one strategy. Flipping one property while holding another is common, and it helps hedge against shifting market conditions across counties like New Castle, Kent, and Sussex.
Hard Money Loan Program Guidelines
Here’s what you can expect when applying for a hard money loan in Delaware through OfferMarket:
| Criteria | Guideline |
|---|---|
| Loan amount (minimum) | $25,000 |
| Loan amount (maximum) | $2,000,000 |
| ARV (minimum) | $100,000 |
| Experience | Not required |
| Credit score (minimum) | 680 |
| Borrowing entity | LLC or Corporation |
| Initial advance | up to 90% |
| Construction holdback | up to 100% |
| LTARV (maximum) | 75% |
| Interest rate | get instant quote |
| Origination fee | 1.5 to 2 points |
| Term | 12 to 24 months |
| Points out | None |
| Prepayment penalty | None |
| Structure | Interest-only with balloon payment |
| Recourse | Full (51% of borrowing entity must guarantee) |
| Exit strategy: Sale | minimum 30% ROI |
| Exit strategy: Refinance | minimum 1.1 DSCR after repairs |
| Valuation | Appraisal report or In-house valuation |
| SqFt (minimum) | Single family: 700+ 2-4 unit: 500+ per unit Condo: 500+ |
| Acreage (maximum) | 5 |
| Interest accrual | Under $100,000 loan: full boat $100,000+ loan: as disbursed |
| Advanced draws | Lender discretion |
| Down payment (minimum) | $10,000 |
Project Eligibility
At OfferMarket, we’re committed to making Delaware investors successful—and that starts with smart project selection and risk management.
Our foreclosure rate across all loans nationwide is under 0.5%. In Delaware, where property values and market conditions can vary from Wilmington to Dover and smaller towns like Middletown or Seaford, success hinges on careful planning.
We advise new investors to avoid “heavy” or “extensive” rehabs unless they have relevant experience and strong liquidity. Large-scale renovations often bring delays, budget creep, and greater exposure to shifting market conditions—especially in economically sensitive zones.
We’re more than just a lender—we act as your risk advisor and funding partner. That’s why we’ve developed a tiered system based on your experience and clearly define rehab scope eligibility.
Initial Advance
For our Delaware borrowers, the initial advance is calculated using both borrower qualifications and the specific property details. We review your investment track record—including how many projects you’ve owned in the past 24 months and completed in the last five years. Your personal credit score matters too. A score of 680 is the baseline, but 720+ is preferred for higher leverage. Special consideration is given to Realtors, licensed contractors, and engineers.
If your agreed purchase price is higher than the appraised “As Is” value, your loan advance will be capped based on that appraised value—not your contract price.
Your exit strategy also plays a key role:
Flip exit strategy: We want to see at least a 30% projected ROI and $15,000 minimum profit.
Rental exit strategy (refinance): Your DSCR after renovations must be at least 1.1.
In rural areas of Delaware—such as parts of Sussex County—experience becomes even more critical. If your project is rural, expect a lower initial advance and a minimum experience level of 3.
Experience-based Tiers
Your tier determines your loan terms, including the initial advance and rehab eligibility.
| Tier | Verifiable experience |
|---|---|
| 1 | 0 |
| 2 | 1 to 2 |
| 3 | 3 to 4 |
| 4 | 5 to 9 |
| 5 | 10+ |
Initial Advance by Tier
| Tier | Initial advance (% of purchase price) |
|---|---|
| 1 | 80% (*) |
| 2 | 85% |
| 3 | 85% |
| 4 | 90% |
| 5 | 90% |
(*) 85% is considered on an exception basis for Delaware investors with exceptional credit and liquidity.
Adjustments to Initial Advance
The table below lists conditions that influence your advance amount:
| Scenario | Adjustments |
|---|---|
| Credit score less than 720 | -5% |
| Full gut rehab | -5% |
| New market | -5% |
| Licensed Realtor | up to +5% |
| Licensed General Contractor | up to +10% |
| Licensed Professional Engineer | up to +10% |
| Rural | -20% (3+ experience required) |
Rehab Scope Classification
We classify your rehab scope by the proportion of renovation costs to the purchase price:
| Rehab Scope | Definition |
|---|---|
| Light | Rehab budget < 25% of purchase price |
| Moderate | Rehab budget 25% to 49.99% |
| Heavy | Rehab budget 50% to 99.99% |
| Extensive | Rehab budget 100%+ — additions, expansions, or low-cost property flips |
Delaware investors often encounter homes where the rehab cost nears or exceeds the purchase price—especially in distressed urban areas or undervalued suburban spots.
Rehab Scope Eligibility
Your tier level determines which rehab scopes you qualify for:
| Tier | 1 | 2 | 3 | 4 | 5 |
|---|---|---|---|---|---|
| Experience | 0 | 1-2 | 3-4 | 5-9 | 10+ |
| Light | Eligible | Eligible | Eligible | Eligible | Eligible |
| Moderate | Ineligible | Eligible | Eligible | Eligible | Eligible |
| Heavy | Ineligible | Eligible | Eligible | Eligible | Eligible |
| Extensive | Ineligible | Ineligible | Eligible | Eligible | Eligible |
LTARV Limits
Loan-to-after-repair value (LTARV) limits based on your experience and rehab type:
| Tier | 1 | 2 | 3 | 4 | 5 |
|---|---|---|---|---|---|
| Experience | 0 | 1-2 | 3-4 | 5-9 | 10+ |
| Light | 70% | 70% | 75% | 75% | 75% |
| Moderate | Ineligible | 70% | 75% | 75%< | 75% |
| Heavy | Ineligible | 70% | 75% | 75%< | 75% |
| Extensive | Ineligible | Ineligible | 70% | 70% | 70% |
LTFC Limits
LTFC (Loan-to-Full-Cost) applies when your renovation budget exceeds your property’s purchase price or value.
| Tier | 1 | 2 | 3 | 4 | 5 |
|---|---|---|---|---|---|
| Experience | 0 | 1-2 | 3-4 | 5-9 | 10+ |
| Light | N/A | N/A | N/A | N/A | N/A |
| Moderate | Ineligible | N/A | N/A | N/A< | N/A |
| Heavy | Ineligible | N/A | N/A | N/A< | N/A |
| Extensive | Ineligible | Ineligible | 85% | 90% | 90% |
Example: No Experience
| Metric | Value |
|---|---|
| Purchase price | $100,000 |
| Tier | 1 |
| Credit score | 695 |
| Rehab budget | $24,000 |
| ARV | $150,000 |
| Initial advance | $75,000 |
| Construction holdback | $24,000 |
| Total loan | $99,000 |
| LTARV | 66% |
| LTFC | 79.8% |
| Interest accrual | Full boat |
Example: No Experience, Excellent Credit
| Metric | Value |
|---|---|
| Purchase price | $100,000 |
| Tier | 1 |
| Credit score | 750 |
| Rehab budget | $24,000 |
| ARV | $150,000 |
| Initial advance | $80,000 |
| Construction holdback | $24,000 |
| Total loan | $104,000 |
| LTARV | 69.33% |
| LTFC | 83.9% |
| Interest accrual | As disbursed |
Example: 5 Experience
| Metric | Value |
|---|---|
| Purchase price | $100,000 |
| Tier | 4 |
| Credit score | 750 |
| Rehab budget | $20,000 |
| ARV | $150,000 |
| Initial advance | $90,000 |
| Construction holdback | $20,000 |
| Total loan | $110,000 |
| LTARV | 73.33% |
| LTFC | 91.67% |
| Interest accrual | As disbursed |
Refinance Using As Is Value Instead of Cost Basis for Initial Advance
When refinancing in Delaware, if your property’s As Is value is significantly higher than your cost basis, we may lend based on the As Is value. Here’s what we require:
Property in habitable shape (C4 or better)
At least 3 years of ownership
Clean payoff statement with no late or default fees
Credit score of 680+
Experience Tier 3 or higher
Strong comp support
Logical scenario (e.g. tenant vacated after long-term lease)
Wholesaler Transactions and Price Run-ups
If you acquired a Delaware property through a wholesaler:
| Example | Value |
|---|---|
| A-B Price | $100,000 |
| Assignment | $25,000 |
| As Is Value | $125,000 |
| Value Basis | $120,000 |
OfferMarket includes up to a 20% markup in the value basis if fully documented and legitimate. We will not finance finders or referral fees. Full transparency is required with contracts and operating agreements.
Construction Holdback
For your Delaware rehab projects, the construction holdback portion of your loan is reimbursed based on work progress and a validated scope of work. Funds are wired to you as draws once proof of progress is submitted.
If you’d rather fund your renovation using personal capital and skip the draw process entirely, you can opt out of the construction holdback portion. This is a popular approach for experienced Delaware investors seeking maximum speed and autonomy.
If your total loan exceeds $100,000, you only pay interest on the funds you’ve drawn—not the full loan balance.
| Criteria | Draw Processing Guideline |
|---|---|
| Minimum draw amount | None |
| Maximum draw amount | 100% of remaining construction holdback |
| Minimum number of draws | 0 |
| Maximum number of draws | None |
| Materials delivered but not installed | 50% reimbursable (receipt/invoice required) |
| Draw inspection | App-based (self-serve) |
| Draw turnaround | 0 to 2 business days |
| Draw fee | $270 |
| Wire fee | $30 |
Appraisal and In-House Valuation
Every Delaware hard money loan requires a valuation. Depending on your scenario, we may use one of three methods:
In-house valuation
| Criteria | Eligibility requirement |
|---|---|
| Property type | 1-4 unit residential |
| Tier | 4 or higher |
| Credit score | 720+ |
| Rural | Not eligible |
| New market | Not eligible |
| LTARV | 70% max |
Even if you meet these criteria, OfferMarket may still require a full appraisal.
Exterior appraisal
You may use an exterior appraisal for Delaware properties acquired via:
Bank-owned sales (REO)
Foreclosure auctions
Sheriff’s sales
Bankruptcy sales
Exterior appraisals must be dated within 120 days of closing. If the report is 120–179 days old, it must be recertified.
Interior appraisal
In all other Delaware loan cases, a full interior appraisal is needed.
| Property type | Appraisal forms |
|---|---|
| Single family | 1004 + 1007 ARV including As Is (non-gridded) |
| 2-4 Unit | 1025 + 216 ARV including As Is (non-gridded) |
| Condo | 1073 + 1007 ARV including As Is (non-gridded) |
OfferMarket handles appraisal ordering. You’ll pay the invoice directly, and we’ll move your loan forward upon payment confirmation.
Appraisal Transfer
If you already ordered an appraisal for your Delaware property through an approved AMC (Appraisal Management Company), it can be transferred if:
It’s under 180 days old
It meets Appraiser Independence Requirements (AIR)
A signed transfer letter and full report files are submitted
Invoice is included to show payment has been made
Scenario: Stabilized Hard Money Loan
When your Delaware property is rent-ready (C4 condition or better) with no major repairs needed, you may qualify for a stabilized loan—up to 75% of the current As Is value.
| Criteria | Guideline |
|---|---|
| LTV (max) | Tier 1–2: 70% Tier 3–5: 75% |
| LTFC (max) | Tier 1–2: 80% Tier 3–5: 90% |
| Appraisal condition rating | C1, C2, C3, or C4 |
| Loan term (max) | 12 months |
Key Loan Details
| Criteria | Details |
|---|---|
| Loan Amount | $25,000 to $2,000,000* |
| Units per Property | 1–4 |
| Eligible Property Types | Non-owner occupied 1-4 unit residential Single family, 2–4 unit multifamily, townhomes, condos |
| Property Minimum Size | Single Family: 700+ SQFT Condo/2-4 Unit: 500+ SQFT per unit |
| Max Acreage | 5 acres |
| Loan to Cost (LTC) | Up to 90% purchase, 100% rehab |
| Loan to ARV (LTARV) | Up to 75% |
| Down Payment | Minimum $10,000 (if purchase under $100K) |
| Loan Term | 12 months standard; 18–24 months available |
| Extensions | Up to 50% of original term (fees apply) |
| Points | 1.5 to 2 points (min $2,000) |
| Prepayment Penalty | None |
| Occupancy | Non-owner occupied – business use only |
| Transaction types | Purchase, refinance (arms-length only) |
| Geographic Region | Available across the U.S. — including Delaware! |
| Amortization | Interest-only with balloon payment |
| Interest Accrual Method | < $100K: full boat $100K+: as disbursed |
Extensions
Hard money loans are meant to be short-term financing tools. Most of our Delaware borrowers repay within 12 months, even if they’re approved for longer terms. While we offer extensions, they’re best avoided—they bring added fees, additional interest, and potential foreclosure risk if the loan isn’t repaid after the final extension.
To reduce the need for extensions, it’s important to avoid:
Contractors who lack strong references or experience
Overly ambitious renovation projects that exceed your track record
Jurisdictions in Delaware with slow permitting or zoning processes
Properties where you can't take possession right away (i.e. tenant holdover, inherited lease)
Deals with no clear fallback exit (i.e. can’t flip or rent if one fails)
Managing these risks upfront keeps your timeline—and investment—on track.
Extension Limits
| Initial Loan Term | Max Extension |
|---|---|
| 12 months | 6 months |
| 18 months | 9 months |
| 24 months | 12 months |
Extension Terms and Fees
| Extension Term | Fee |
|---|---|
| 3 months (1st request) | 1% of total loan |
| 3 months (2nd request) | 1.5% of total loan |
| 6 months (1st request) | 2.5% of total loan |
Extension Prerequisites
Before your extension request is approved, you must confirm that your builder’s risk insurance policy will remain active through the extended loan term.
Ineligible Property Types
The following Delaware property types are not eligible under this program:
Mixed-use buildings
Properties with 5+ residential units
Condotels or co-ops
Mobile or manufactured homes
Commercial properties (retail, industrial, etc.)
Cabins or log homes
Land with oil/gas leases
Working farms, orchards, or ranches
Seasonal or vacation-only residences
Unusual or ultra-luxury homes
Homes on unpaved or dirt roads
Exception Scenarios
We may still consider your Delaware deal under the following exceptions:
Personal credit score between 660–679
Leasehold (ground rent) properties
Single-family homes between 500–699 SQFT
2–4 unit properties with at least one unit between 400–499 SQFT
Initial advance based on As Is value higher than cost basis
Non-arm’s length transactions
Financed interest payments
Borrower and Guarantor Requirements
| Item | Requirements |
|---|---|
| Borrowing Entities | LLC or Corporation (nonprofits excluded) |
| Eligible Borrowers | U.S. Citizens, Permanent Residents, or qualifying Foreign Nationals |
| Foreign Nationals | Passport + valid U.S. Visa (no tourist/student-only) U.S. credit score required if guaranteeing |
| Credit Requirements | 680 FICO minimum (660–679 by exception) Tri-Merge report (within 120 days) |
| Liquidity | Must cover cash to close + 25% of rehab budget (among guarantors) |
| Eligible Liquid Assets | Bank, brokerage, or retirement accounts (50% haircut on retirement) |
| Guaranty Structure | Purchases: ≥51% of borrowing entity must guarantee Cash-out refis: 100% must guarantee |
| Recourse | Full recourse required |
| Net Worth | Guarantor net worth ≥ 50% of total loan |
Liquidity Verification
To promote responsible lending and reduce risk, we require Delaware guarantors to demonstrate adequate liquidity before loan funding. This ensures that you have enough capital to close your deal and keep your rehab on schedule.
At a minimum, you must show verified liquid assets equal to your estimated cash to close plus 25% of your rehab budget. These funds must be held by one or more guarantors associated with the borrowing entity.
Accepted liquid asset types:
Personal checking or savings accounts
Business accounts held in the borrowing LLC or corporation
Business accounts in another entity (requires verification of relationship via operating agreement)
Personal brokerage accounts
Brokerage accounts held by the borrowing entity
Brokerage accounts in another business entity (also requires operating agreement)
Personal retirement accounts (IRA, 401(k), etc.) — valued at 50% to account for restricted access
Important considerations for Delaware borrowers:
While not mandatory, having a dedicated business bank account is strongly encouraged. It streamlines accounting and protects against co-mingling of funds.
You are not required to transfer or move your funds prior to settlement. We only need to verify their existence.
At closing, your required contribution (cash to close) will be clearly stated on your Delaware settlement statement and must be wired directly to the title company or attorney managing the transaction.
Credit and Background Items
We assess each Delaware borrower with a careful review of credit history and background. Key criteria include:
Credit Scores: Middle of 3 or lowest of 2 FICO scores used
No Tradelines: 6 months interest reserve required
<5 Tradelines: Also requires 6 months reserves
Bankruptcy or Foreclosure: Must be discharged for 4+ years
Late Payments or Past Due: Must be paid before closing
Civil/Criminal Suits: Discretionary eligibility
Serious/Financial Crimes: Not eligible
Interest Reserves
These reserves are pre-collected funds used to cover interest during early stages of the loan, especially when cash flow is tight.
| Interest Reserve | Scenario |
|---|---|
| 0 month | Lender discretion |
| 1 month | FICO 700+ |
| 3 months | FICO 660–699 |
| 6 months | FICO 660–699 with concerning background/credit items |
Financed Interest Payments
To protect your liquidity and preserve your credit score, Delaware investors may qualify to have interest payments added to the loan balance, rather than paid monthly.
Example:
| Detail | Amount |
|---|---|
| Total Loan | $100,000 |
| Interest Rate | 12% |
| Months Held | 9 |
| Accrued Interest | $9,000 |
| Payoff | $109,000 (principal + unpaid interest) |
Property Sourcing Guidelines
To ensure transparency and support accurate underwriting, we ask Delaware investors to submit clear documentation when sourcing properties—especially in off-market or wholesale scenarios.
Key documentation includes:
Fully executed purchase contracts
Settlement statements
Payoff letters (if refinancing)
Track record summaries
Operating agreements and entity formation documents
If you’re investing in Delaware condos, doing a conversion, or undertaking heavy renovations, you may be asked to submit permits or letters from an architect or engineer.
In cases involving price escalations or wholesaling, additional review and supporting documentation may be required.
Insurance Guidelines for Hard Money Loans
Insurance is critical in real estate investment, particularly for projects under renovation, vacant homes, or properties in less-than-pristine condition.
For your Delaware hard money loan, you’ll need specialized coverage—typically called Builders Risk or Fix and Flip insurance.
Coverages and Limits
| Coverage Type | Limit | Required |
|---|---|---|
| Dwelling | Replacement cost or loan amount | Yes |
| Liability | $1M per occurrence / $2M aggregate | Yes |
| Builders Risk | Included | Yes |
| Flood | Greater of $250K or loan balance (if FEMA SFHA) | Conditional |
Coverage Details
| Coverage Item | Requirement |
|---|---|
| AM Best Rating | A- VIII or higher |
| Policy Type | Special Form |
| Deductible | $1,000 to $5,000 |
| Lender's Designation | Must be listed as mortgagee and additional insured |
| Exclusions | Policy must include windstorm and hail coverage |
| Cancellation | 30-day notice minimum |
💡 Pro tip for Delaware investors: The moment you close, secure your property. Install smoke detectors, locks, and security cameras. It helps meet insurance conditions and protect against claims denials.
Frequently Asked Questions About Delaware Hard Money Loans
What states does OfferMarket fund hard money loans in?
We lend in nearly every U.S. state, and Delaware is proudly on that list. In states requiring special licensing or where we don't directly lend, we act as a loan marketplace.
Can I have multiple hard money loans at once?
Absolutely. Many Delaware clients manage several active loans simultaneously. We’ll review your liquidity and project capacity to ensure safe scaling.
Are these loans considered commercial?
Yes. Hard money loans are business-purpose loans and are issued to your LLC or Corporation.
What's the minimum loan amount?
$25,000 is our floor for hard money loan amounts in Delaware and all states.
What types of Delaware properties are eligible?
Single-family residences (non-owner occupied)
Townhomes
2-4 unit multifamily properties
Warrantable condominiums
We do not fund commercial, mixed-use, or 5+ unit properties under this program.
How is Loan-to-Value calculated?
Loan-to-Value (LTV) typically refers to the Loan-to-After-Repair Value (LTARV). Your initial advance is based on the lower of As Is value or purchase price. LTARV includes both the purchase and rehab financing divided by the expected post-rehab value.
What are the credit requirements?
Minimum FICO score: 680. We evaluate the scores of all members who will guarantee the loan.
Do I need experience?
No prior experience is required. However, seasoned investors receive higher leverage. Your completed projects help us verify your eligibility for more complex deals.
Does wholesaling count toward experience?
It does not. Only projects where you were financially responsible for the rehab are considered verifiable experience.
What documentation is required?
Our streamlined Loan File system helps Delaware real estate investors speed through the approval process. Documents you upload now will be saved securely to help expedite future loans.
Purchase Transaction Requirements
| Loan File Sections | Required Documentation |
|---|---|
| Purchase | Purchase contract (signed by buyer and seller) |
| Credit Report | Soft tri-merge credit report for each guarantor |
| Background Report | Required for each guarantor |
| Track Record | Project history for each guarantor |
| ID Verification | Government-issued ID (driver’s license, passport, etc.) |
| Borrowing Entity | Articles of Organization/Incorporation, Operating Agreement/Bylaws, Certificate of Good Standing, W-9 |
| Scope of Work | Rehab budget used to determine ARV |
| Appraisal Report | Link provided to pay invoice; uploaded to your loan file |
| Bank Statements | Two most recent statements for each guarantor (can be personal or business) |
| Letter of Explanation | If requested (i.e. large deposits, late payments, background items) |
Refinance Transaction Requirements
| Loan File Sections | Required Documentation |
|---|---|
| Settlement Statement | Finalized closing statement from original purchase |
| Credit Report | Soft tri-merge credit report for each guarantor |
| Background Report | Required for each guarantor |
| Track Record | Project history for each guarantor |
| ID Verification | Government-issued ID |
| Borrowing Entity | Articles of Organization/Incorporation, Operating Agreement/Bylaws, Certificate of Good Standing, W-9 |
| Sunk Costs | Line-item breakdown of expenses already incurred |
| Scope of Work | Rehab budget for ARV and project scope |
| Appraisal Report | Link provided to pay invoice; uploaded to your loan file |
| Bank Statements | Two most recent statements for each guarantor |
| Letter of Explanation | If requested by underwriting team |
Are there special requirements for loans over $1M?
Yes. For hard money loans in Delaware exceeding $1 million, additional guidelines apply to ensure project viability and borrower capability. These deals receive enhanced underwriting scrutiny.
| Criteria | Explanation |
|---|---|
| Experience | At least 3 completed projects preferred, ideally at a similar price point |
| Market Liquidity | Minimum of 3 comparable sales within 2 miles over the past 6 months |
| Credit Score | Minimum 680 FICO and 5 tradelines with 24-month history |
| Rural Designation | Not eligible if property is rural under CFPB/USDA/appraisal definitions |
| Track Record | Required for all guarantors in the borrowing entity |
Glossary of Key Terms
| Term | Definition |
|---|---|
| ADU | Accessory Dwelling Unit. A separate, livable space—like a basement apartment or backyard cottage—on the same tax lot as a primary single-family residence. |
| Arms-length | A transaction where all parties act independently and have no existing relationship, ensuring fair market pricing. |
| Non-Arms-length | A deal involving parties with a personal or financial relationship, which could influence terms or value. |
| Initial Advance | The upfront loan amount allocated to cover the property’s purchase price. Sent to the title company at closing. |
| Construction Holdback | Funds reserved for renovation costs. Disbursed in stages upon verified completion of project milestones. |
| Interest Reserves | Pre-collected funds held in escrow and used to cover monthly interest payments in the early stages of the loan. |
| LOE | Letter of Explanation. A written statement from the borrower providing clarification on credit, financial, or background issues. |
| LTC | Loan-to-Cost. The percentage of total project cost (purchase + rehab) that is financed by the lender. |
| LTFC | Loan-to-Full-Cost. Similar to LTC, but used specifically when rehab costs exceed the property’s purchase price. |
| LTV | Loan-to-Value. Ratio of the loan amount to the property’s current As Is market value. |
| LTARV | Loan-to-After-Repair Value (also ARLTV). Ratio of the loan amount to the projected property value post-rehab. |
| As Disbursed Interest | You’re only charged interest on the amount of the loan that has actually been drawn (not the full loan). |
| Full Boat Interest | Also called "Dutch Interest." Interest accrues on the entire loan amount, regardless of draws. |
| Lopsided Deal | When the purchase price or As Is value is lower than the renovation budget. These projects carry higher execution risk. |
| GC Agreement | A signed contract with your general contractor, outlining rehab scope, costs, and project timelines. |
| DSCR | Debt Service Coverage Ratio. Measures property income against debt obligations. Formula: Rent ÷ PITIA (principal, interest, taxes, insurance, and association dues). |
Instant Hard Money Loan Quote
OfferMarket Capital LLC is a top private lender for 1–4 unit residential real estate investors in Delaware. Whether you’re house-flipping in Wilmington, rehabbing a rental in Newark, or doing value-add deals in Dover, we’re here to help you build wealth through real estate.
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