Hard Money Loan Pennsylvania

Last updated: May 19, 2025

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Our Pennsylvania Hard Money Loan program is specifically designed to deliver fast, reliable, and competitively priced financing for 1-4 unit residential investment properties. Whether your plan is to flip the property or refinance into a DSCR loan and hold it in your rental portfolio, we’re here to support your success in every region of Pennsylvania.

Let’s dive into the OfferMarket Hard Money Loan Program built for Pennsylvania investors.

What is a hard money loan?

A hard money loan is a short-term, asset-based loan secured by residential real estate—typically 1-4 unit properties. It’s used to acquire, refinance, or improve properties for resale or long-term rental purposes.

These loans are often referred to as “bridge loans” or “fix and flip loans” in the real estate investor community and are especially popular in cities like Harrisburg, Scranton, and Erie where value-add opportunities are common.

Hard money loan scenarios

Hard money loans are commonly used in Pennsylvania for:

• Purchasing and renovating outdated properties – for example, acquiring a fixer-upper in Reading and funding the rehab to increase resale or rental value.
• Refinancing a property acquired in cash – such as a fast cash purchase in Allentown where the seller required a quick close, and now you want to unlock capital for the renovation phase.
• Refinancing an active loan – where your existing lender (perhaps for a property in York or Lancaster) needs to be paid off while you continue work on the property.
• Purchasing without rehab – acquiring an off-market property in Wilkes-Barre below market value to sell as-is at a markup.
• Refinancing a cash deal with no renovation – freeing up equity from a property in Altoona that you intend to resell soon.
• Post-rehab refinance – converting a flipped or renovated property into a rental in places like Bethlehem or State College.

How it works

A Pennsylvania hard money loan from OfferMarket includes two core components:

• Initial Advance – This portion of the loan is applied to the purchase price of the property. The funds are wired directly to the title company at closing.
• Construction Holdback – This part of the loan covers your renovation budget. It’s reimbursed to you in draws as you make progress on the rehab project.

Our hard money loans are designed to flex around your strategy. You might only need an initial advance if you’re not planning to renovate. Or, if you’ve already bought a property with cash in a market like Scranton or Chester and now want to finance the rehab, you might only need a construction holdback.

Most Pennsylvania investors choose a combination of both—maximizing leverage while preserving their own capital. Some prefer using only the purchase loan and fund rehab with personal funds. Others may buy a property outright in places like Lancaster and use only the rehab funds.

Your exit could be a flip, or you may refinance into a DSCR loan for rental income. Your strategy can evolve—what starts as a BRRRR in Reading might become a flip if resale values spike. Likewise, you might switch from flip to hold if the Altoona rental market becomes stronger than expected.

Who uses hard money loans?

Real estate investors across Pennsylvania use our hard money loans, including:

• Fix and flip investors – Renovators adding value to properties in Philadelphia’s transitional neighborhoods or Pittsburgh’s up-and-coming districts.
• Rental property investors – Those using the BRRRR strategy in smaller markets like Lancaster, Erie, and Williamsport.

Explore our Fix and Rent bundle: a purchase and rehab loan bundled with a discounted DSCR refinance loan for your BRRRR success in PA.

Hybrid strategies are common—flip some, rent others. That’s a best practice we often see among investors throughout Pennsylvania.

Hard Money Loan Program Guidelines

Project Eligibility

At OfferMarket, helping you manage risk is at the core of our mission. Our historical default rate across all loans is under 0.5%—and we’re proud of it.

In Pennsylvania markets, particularly those with high turnover like Philadelphia or high rehab costs like Harrisburg, we focus on empowering borrowers to avoid high-risk projects unless they have the experience to manage them.

“Extensive” rehab projects—gut jobs, additions, or major expansions—can lead to delays and overruns. Even experienced investors in places like Scranton or York must navigate permitting, materials, and labor challenges.

Our role is more than a lender—we’re your risk advisor and capital partner. Our structured rehab classification ensures that every project fits your capacity and skill level.

Initial Advance

Your initial advance is customized for the deal and your track record. Here’s what we review:

• Investment history in the past 24 months

• Credit score (minimum 680; 720+ preferred)

• Professional background (Realtor, GC, or Engineer = higher leverage)

If the property’s As Is value (per appraisal or valuation) is less than the contract price, the lower value will determine your loan.

Selling the property? You’ll need at least a 30% margin and $15,000 minimum profit. Planning to refinance instead? Your projected DSCR after rehab must be ≥ 1.1.

In rural zones of Pennsylvania (designated by USDA or CFPB), we limit leverage and require more experience.

Experience-based Tiers

Initial Advance by Tier

Adjustments to Initial Advance

Rehab scope classification

Rehab Scope Eligibility

Your eligibility for different rehab scopes depends on your experience tier. Our goal is to help you reduce risk, especially in complex projects. In Pennsylvania, where real estate conditions can vary widely between metro areas and rural markets, it’s especially important to match project difficulty with your experience.

LTARV Limits

Loan-to-After-Repair Value (LTARV) represents your loan amount as a percentage of the property’s projected value after renovations. Your maximum LTARV depends on both your experience tier and the rehab scope of your project. This table helps Pennsylvania investors understand the leverage they can expect based on their track record and project complexity.

LTFC Limits

Loan-to-Full-Cost (LTFC) applies to extensive rehab projects—those where the rehab budget exceeds the purchase price or As Is value. This metric ensures the borrower maintains sufficient equity in high-risk deals, a critical safeguard in variable Pennsylvania markets like Scranton or Altoona.

Example: No Experience

• Purchase price: $100,000

• Credit score: 695

• Rehab budget: $24,000

• ARV: $150,000

• Initial advance: $75,000

• Holdback: $24,000

• Total loan: $99,000

• LTARV: 66%

• LTFC: 79.8%

• Interest: Full boat

Example: No Experience, Excellent Credit

• Credit score: 750

• Initial advance: $80,000

• Total loan: $104,000

• LTARV: 69.3%

• LTFC: 83.9%

• Interest: As disbursed

Example: 5 Experience

• Tier: 4

• Rehab: $20,000

• Initial advance: $90,000

• Total loan: $110,000

• LTARV: 73.3%

• LTFC: 91.6%

• Interest: As disbursed

Refinance Using As Is Value Instead of Cost Basis

In certain refinance scenarios, OfferMarket allows you to use the current market value (As Is value) instead of your cost basis (purchase + rehab expenses) when calculating your initial advance. This can unlock additional leverage for experienced Pennsylvania investors—especially those with long-held properties in appreciating neighborhoods.

To qualify:

• Property must be in livable condition (C4 or better)

• Held for 3+ years

• No late fees or default interest on the payoff letter

• Credit score of 680 or higher

• Minimum Tier 3 experience

• Strong appraisal comps to support As Is value

• Clear business case (e.g. a rental in Reading being upgraded for resale)

Wholesaler Transactions and Price Run-Ups

For properties acquired through wholesalers or double-close deals, OfferMarket can incorporate assignment fees or run-ups in our loan calculations—up to 20% of the A-B contract price.

Example:

• A-B Contract (seller to wholesaler): $100,000

• B-C Contract (you): $125,000

• As Is Value: $125,000

• Allowable value basis: $120,000

Guidelines:

• Maximum price jump: 20%

• Full documentation: A-B and B-C contracts, wholesaler’s operating agreement

• No MLS-listed wholesaler deals

• No financing of referral or finder’s fees

Construction Holdback

Your rehab funds are issued through our streamlined draw process, reimbursed as you make progress.

If you’d rather use your own capital, you may opt out of construction holdback entirely.

Appraisal and In-House Valuation

We require a valuation on every Pennsylvania hard money loan. Options include:

In-House Valuation Available if:

• Property is single-family, duplex, triplex, or fourplex

• Experience Tier 4+

• Credit score ≥ 720

• Not rural or in a new market

• LTARV ≤ 70%

Exterior Appraisal Accepted if:

• Purchased via auction, REO, bankruptcy, or sheriff’s sale

• Appraisal is dated within 120 days (or recertified under 180 days)

Interior Appraisal Required if:

• None of the above conditions apply

• Appraisal must include As Is and ARV values (non-gridded)

OfferMarket will order the appraisal and provide a payment link.

Appraisal Transfer

We accept transferred appraisals if:

• Ordered through approved AMC

• Dated within 180 days

• Recertified if 120–179 days old

• Includes a signed AIR-compliant transfer letter

• You provide the PDF, XML, and invoice showing payment

Scenario: Stabilized Hard Money Loan

For turn-key properties in Pennsylvania with no deferred maintenance (condition rating C4 or better), we offer stabilized funding—up to 75% of current As Is value.

Key Loan Details

Extensions

Hard money loans are designed to be short-term, typically 12 to 24 months. However, OfferMarket understands that unexpected delays can happen—especially in cities like Pittsburgh or Harrisburg where permitting or contractor availability might cause setbacks.

To protect your investment, we allow extensions of up to 50% of your original loan term. However, extensions should be avoided when possible, as they carry added fees and interest—and prolonged timelines increase risk.

Focus on avoiding:

• Inexperienced contractors without reliable references

• Aggressive rehab scopes that outpace your capital or experience

• Markets with slow permitting/zoning processes (common in smaller townships)

• Limited access to the property (tenants, evictions)

• Projects without a viable dual exit strategy

Extension Limits

Extension Terms and Fees

Before you can extend, your builder’s risk insurance must be active for the duration of the new loan period.

Ineligible Property Types

The following property types are not eligible for hard money loan financing in Pennsylvania:

• Mixed use properties

• 5+ unit multifamily buildings

• Co-ops, condotels, cabins, or log homes

• Mobile/manufactured housing

• Properties with oil/gas leases or on unpaved/dirt roads

• Operating farms, orchards, ranches

• Unique, exotic, or luxury properties

• Vacation rentals and seasonal properties

Exception Scenarios

OfferMarket may consider select exception cases for experienced borrowers, including:

• Guarantor credit scores between 660–679

• Leasehold (ground rent) properties

• Small single-family homes (500–699 SQFT)

• 2–4 unit properties with a unit as small as 400 SQFT

• As Is value-based refinance when value exceeds cost

• Non-arms length transactions

• Financed interest payments (added to payoff)

Borrower and Guarantor Requirements

Liquidity Verification

You’ll need to show proof of liquidity to close safely. This includes the sum of your required cash to close plus 25% of the rehab budget.

Eligible assets include:

• Checking/savings accounts (business or personal)

• Brokerage accounts (including IRAs—subject to a 50% haircut)

• Retirement accounts (50% haircut)

• Business accounts (with operating agreement validation)

We require the two most recent statements per account—no seasoning required.

Credit and Background Items

Our underwriting process accounts for credit score, tradeline depth, and background records. Here's how we assess common situations:

Interest Reserves

Depending on your credit and background, OfferMarket may collect interest reserves to ensure smooth payments during the life of the loan.

These reserves are applied first to your monthly interest before you begin making payments from your bank account.

Financed Interest Payments

To preserve your liquidity—especially useful during full gut rehabs in places like York or Bethlehem—you may qualify for financed interest. This means:

• No monthly payments

• Interest accrues and is added to your payoff

Example:
Loan Amount: $100,000
Interest Rate: 12%
Loan Term: 9 months
Interest Added to Payoff: $9,000

Property Sourcing Guidelines

A successful hard money loan depends on a solid foundation—and that begins with your deal. Whether you’re buying in a competitive Philadelphia zip code or securing an off-market duplex in Lancaster County, the source of your deal, how you acquired it, and the documentation supporting it play a vital role in our underwriting.

OfferMarket expects every Pennsylvania investor to present clean, complete deal files. This allows us to close loans faster and minimize surprises that could delay your funding.

Here are the property sourcing guidelines we require:

• New Market Entry: If you’re investing in a Pennsylvania city or township where you haven’t previously completed projects, you’ll need to either:

  • Provide a signed General Contractor (GC) agreement, or

  • Submit a letter explaining why a GC is not required for the project

• Wholesale Transactions and Off-Market Properties: If you’re acquiring through a wholesaler or double close, expect to provide:

  • All chain-of-title contracts (A-B and B-C)

  • Proof of assignment fees

  • Confirmation the transaction is arm’s length

• Past Price Increases: If the property was recently sold and shows a significant price increase (e.g. within 3 months), provide justification for the appreciation—such as significant renovations, market comps, or third-party appraisals.

• Condo Units and Conversions: For condos or conversions, especially those in older buildings common in Pennsylvania cities, submit:

  • HOA documents

  • Structural inspection reports

  • Engineer/architect letters

  • Permits, if structural work or expansion is involved

• General Submission Requirements:

  • Executed purchase contract or payoff letter

  • Track record documentation

  • Formation documents (LLC, operating agreements, etc.)

Our Pennsylvania underwriting team is highly experienced and familiar with both urban and rural market dynamics. The more context and transparency you provide in your Loan File, the faster we can move.

Insurance Guidelines for Hard Money Loans

Securing your investment isn’t just about leverage and construction. Insurance is a cornerstone of responsible real estate investing—especially in Pennsylvania, where you may encounter older housing stock, harsh winters, or unique building materials in cities like Scranton or Allentown.

OfferMarket requires Builders Risk Insurance (also known as Fix and Flip Insurance) for every funded deal. This policy type bundles dwelling coverage, liability protection, and construction-specific coverages that traditional homeowners policies don’t offer.

Coverages and Limits

Coverage Details

💡 Tip: As soon as you take ownership, install smoke detectors, locks, and security cameras. Not only will this protect your project—it will help ensure claims aren’t denied due to preventable issues.

Frequently Asked Questions

What states does OfferMarket fund hard money loans?

• Arizona*
• Alabama
• Arkansas
• California
• Colorado
• Connecticut
• Delaware
• Florida
• Georgia
• Hawaii
• Idaho
• Illinois
• Indiana
• Iowa
• Kansas
• Kentucky
• Louisiana
• Maine
• Maryland
• Massachusetts
• Michigan
• Mississippi
• Missouri
• Minnesota*
• Montana
• Nebraska
• Nevada*
• New Hampshire
• New Jersey
• New Mexico
• New York
• North Carolina
• North Dakota*
• Ohio
• Oklahoma
• Oregon
• Pennsylvania
• Rhode Island
• South Carolina
• South Dakota*
• Tennessee
• Texas
• Utah
• Vermont*
• Virginia
• Washington
• Washington DC
• West Virginia
• Wisconsin
• Wyoming

(*) In states where NMLS license is required for business purpose lending or we do not directly lend, OfferMarket operates as a rate shopping service and refers your loan to a licensed capital provider.

Can I have multiple hard money loans at once?

Yes. Many of our clients in Pennsylvania have multiple active loans. However, we assess your overall liquidity and execution pace. If we believe you’re overleveraged or moving too fast, we’ll work with you to pace your projects responsibly.

Are hard money loans considered commercial?

Yes. These loans are strictly business purpose, made to your LLC or Corporation. Because they are used for income-producing real estate or fix-and-flip projects, they are categorized as commercial loans—even if the underlying property is residential.

What is the minimum loan amount?

The minimum loan size for a hard money loan in Pennsylvania is $25,000. This makes OfferMarket accessible for smaller deals in low-cost markets like Altoona, Johnstown, or some Pittsburgh neighborhoods.

Which property types are eligible?

Eligible properties include:

• Non-owner occupied 1–4 unit residential properties

• Single-family homes

• Townhomes

• 2–4 unit multifamily properties

• Warrantable condominiums

Note: Mixed-use, co-ops, and 5+ unit multifamily are not eligible under this program.

How do you calculate LTARV?

LTARV stands for Loan-to-After-Repair Value. It is calculated as:

(Initial Advance + Construction Holdback) ÷ After Repair Value (ARV)

ARV is determined through a third-party appraisal or an in-house valuation, depending on your deal structure. Our loan amount will never exceed the permitted LTARV cap for your experience tier and rehab scope.

What are the credit requirements?

A minimum FICO of 680 is required. Borrowers with scores between 660–679 may be eligible on an exception basis. We only evaluate credit scores of members who will be personally guaranteeing the loan.

Is real estate experience required?

No. We lend to first-time investors throughout Pennsylvania. However, your experience tier will affect how much leverage we offer and what types of projects you can pursue.

Does being a wholesaler count toward experience?

No. Wholesaling experience alone does not qualify toward our verifiable project count. We only recognize deals where you were financially responsible for the property rehab and resale or refinance.

What documentation is required?

Here’s a high-level overview:

For Purchase Transactions:

• Purchase contract (executed)

• Soft tri-merge credit report for all guarantors

• Background reports

• Track record

• ID (driver’s license or passport)

• LLC documents (Articles of Org, Operating Agreement, etc.)

• Scope of work and rehab budget

• Appraisal or valuation

• Bank statements (2 months)

• Letter of explanation (if requested)

For Refinance Transactions:

• Settlement statement (original purchase)

• Credit and background reports

• Track record

• ID verification

• Sunk costs breakdown

• Scope of work

• Appraisal or valuation

• 2 months of bank statements

• Letter of explanation if required

Are there different requirements for loans over $1 million?

Yes. Loans exceeding $1M are subject to stricter underwriting:

Glossary of Key Terms

Instant Hard Money Loan Quote

OfferMarket Capital LLC is a leading private lender for Pennsylvania real estate investors. Whether you're flipping rowhomes in South Philly, converting duplexes in the Poconos, or stabilizing rentals in Lancaster, our hard money loan program is built for speed, flexibility, and affordability.

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