Hard Money Loan Virginia

Last updated: May 20, 2025

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Our Virginia Hard Money Loan program offers fast, trustworthy, and affordable financing solutions to help you purchase, refinance, and renovate 1-4 unit residential investment properties across the state.

Whether you plan to flip homes in Richmond, renovate rentals in Norfolk, or refinance properties in Northern Virginia to cash out and grow your portfolio, we want to help you succeed in the Virginia real estate market.

Let’s explore the OfferMarket Hard Money Loan Program tailored for Virginia investors!

What is a Hard Money Loan in Virginia?

A hard money loan is a short-term, asset-backed loan secured by residential real estate—specifically 1-4 unit properties in Virginia. These loans fund purchases, refinancing, and rehabs, giving you capital to flip homes or hold rentals in key Virginia cities and regions.

Often called “bridge loans” or “fix and flip loans,” hard money loans serve as essential financing tools for Virginia investors aiming to act quickly and maximize their return on investment.

Hard Money Loan Use Cases in Virginia

Virginia real estate investors typically use hard money loans for these purposes:

• Buy and renovate distressed or outdated properties in neighborhoods like Richmond’s Church Hill or Alexandria’s Old Town to increase property value without tying up cash.

• Refinance a Virginia property bought in cash, then use loan proceeds to complete renovations.

• Refinance existing loans on rehab projects in cities like Virginia Beach while finishing upgrades to improve marketability.

• Purchase undervalued off-market properties in emerging Virginia markets with plans to sell “as-is” for profit.

• Tap into equity from a Virginia property bought below market to finance additional acquisitions.

• Refinance stabilized Virginia rental properties to obtain better financing terms.

How Virginia Hard Money Loans Work

Virginia hard money loans consist of two parts:

Initial Advance: Funds wired at settlement towards the property purchase price.

Construction Holdback: Funds reserved for rehab expenses, paid out via draw requests as work progresses.

You can customize your Virginia loan — request just the initial advance, only a construction holdback, or both — depending on your investment strategy and cash flow preferences.

Most Virginia investors combine both to leverage funds efficiently and minimize personal cash deployment. Some prefer only the purchase advance if rehabbing with their own funds or plan to flip “as-is.”

Your exit plan might be to flip Virginia properties for quick profit or to rent and refinance into a longer-term DSCR loan. Many Virginia investors adjust their exit based on local market conditions — for instance, switching from flipping a home in Richmond to renting it out in a softer market.

Who Benefits from Hard Money Loans in Virginia?

• Fix and Flip Investors renovating homes in cities like Richmond, Roanoke, and Charlottesville.

• Rental Property Investors using the BRRRR method (Buy, Rehab, Rent, Refinance, Repeat) across Virginia’s suburban and urban markets.

Hybrid strategies combining flips and rentals are common and effective for Virginia real estate entrepreneurs adapting to shifting market trends.

Virginia Hard Money Loan Program Guidelines

Project Eligibility

At OfferMarket, our commitment is to support your wealth-building journey through Virginia real estate by prioritizing risk management. Throughout our lending history, fewer than 0.5% of all loans originated in Virginia and beyond have resulted in default and foreclosure. We take pride in your success and aim to maintain the lowest default rate in the private lending industry.

Borrowers with limited experience undertaking projects of high complexity put themselves at considerable financial risk. In Virginia, “heavy” and “extensive” rehab projects—such as major renovations in older Richmond homes or large-scale additions in suburban Alexandria—often encounter delays, cost overruns, and market shifts that challenge even seasoned investors with strong liquidity. These risks are particularly pronounced during times of economic uncertainty affecting the Virginia housing market.

Our role as your hard money lender in Virginia is to be more than a capital source: we serve as your deal advisor and risk manager, guiding you through structured expectations that empower you to grow your real estate business safely. Below, you will find our rehab scope classification system and eligibility criteria tailored for Virginia investors.

Initial Advance

The initial advance amount in Virginia is determined by both borrower-specific and deal-specific factors. We evaluate your real estate portfolio activity in Virginia over the past 24 months, including the number of completed rehab projects with similar scopes within the last five years. While experience is not required, a minimum credit score of 680 is necessary, with a strong preference for personal guarantors to have credit scores of 720 or higher. Licensed Realtors, General Contractors, and Professional Engineers based in Virginia may qualify for increased leverage.

If the contract purchase price exceeds our appraisal or in-house valuation’s opinion of the property’s “As Is” value—common in competitive Virginia markets like Northern Virginia or Hampton Roads—the initial advance will be based on the lower “As Is” value, not the contract price.

Your exit strategy also influences the initial advance. For flips in Virginia’s cities, a minimum projected gross margin of 30% and at least $15,000 projected profit are required. If your plan is to rent and refinance, or if your flip scenario doesn’t meet desired loan amounts, a minimum post-repair DSCR of 1.1 is necessary. Use our Fix and Flip and DSCR calculators to analyze your Virginia projects’ exit strategies.

Properties designated as rural in Virginia, such as those in less densely populated areas of Southwest Virginia or the Shenandoah Valley, will have limited initial advance amounts and require a minimum experience level of 3.

Experience-based Tiers

Initial Advance by Tier

*85% advance available on a case-by-case basis for Virginia borrowers with excellent credit and liquidity.

Adjustments to Initial Advance

Below are scenarios where your initial advance for Virginia properties may be adjusted:

Rehab Scope Classification

*“Lopsided deal” refers to when the “As Is” value or purchase price is less than the rehab cost. See LTFC Limits below for Tier and rehab limits.

Rehab Scope Eligibility

Eligibility for rehab projects in Virginia is tied to your experience tier and the rehab scope classification. We recommend Virginia investors focus on projects with lighter rehab scopes—often called “cosmetic” rehabs—that can be completed quickly and efficiently.

LTARV Limits

Your maximum loan-to-after-repair-value (LTARV) in Virginia depends on your experience tier and rehab scope:

LTFC Limits

Loan-to-Full-Cost (LTFC) applies to rehab scopes classified as Extensive—where the rehab budget exceeds the purchase price or “As Is” value of the property. An LTFC limit of 85% means we finance up to 85% of the total project cost (purchase price plus rehab budget), requiring Virginia investors to cover at least 15% out of pocket to ensure commitment and reduce risk in projects with greater execution challenges.

Example: No Experience

• Purchase price: $100,000

• Tier: 1 (0 similar verifiable experience)

• Credit score: 695

• Rehab budget: $24,000

• ARV: $150,000

• Initial advance: $75,000 (75%)

• Construction holdback: $24,000

• Total loan amount: $99,000

• LTARV: 66%

• LTFC: 79.8%

• Interest accrual: Full boat

Example: No Experience, Excellent Credit

Purchase price: $100,000

• Tier: 1 (0 similar verifiable experience)

• Credit score: 750

• Rehab budget: $24,000

• ARV: $150,000

• Initial advance: $80,000 (80%)

• Construction holdback: $24,000

• Total loan amount: $104,000

• LTARV: 69.33%

• LTFC: 83.9%

• Interest accrual: As disbursed

Example: 5 Experience

• Purchase price: $100,000

• Tier: 4 (5 similar verifiable experience)

• Credit score: 750

• Rehab budget: $20,000

• ARV: $150,000

• Initial advance: $90,000 (90%)

• Construction holdback: $20,000

• Total loan amount: $110,000

• LTARV: 73.33%

• LTFC: 91.67%

• Interest accrual: As disbursed

Refinance Using As Is Value Instead of Cost Basis for Initial Advance

Our standard underwriting for Virginia properties lends within your cost basis—purchase price plus sunk costs—to ensure borrowers maintain equity (“skin in the game”).

For refinance scenarios with seasoned Virginia properties valued higher “As Is” than the cost basis, and where renovation funds are needed, OfferMarket reviews requests with the following criteria:

• Property must be habitable (condition rating C4 or better) and not in disrepair.

• Property should be seasoned at least 3 years in the Virginia market.

• Payoff statements must not contain default interest, extension fees, or late charges.

• Minimum credit score of 680.

• Experience tier 3 or higher with at least 4 similar completed rehab projects in Virginia.

• Strong market support for “As Is” value exceeding cost basis, including recent comparable sales from local Virginia neighborhoods.

• Supportive transaction scenarios, e.g., rental properties recently vacated and now needing renovation for resale.

Transactions Involving Wholesalers in Virginia

If the transaction involves a wholesaler, the entire assignment fee or double-close price increase may be included in your cost basis up to 20% of the original purchase price between wholesaler and seller (owner of record). Any excess above 20% is the borrower’s responsibility.

For example:

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

• B-C Contract (wholesaler to buyer): $25,000

• As Is Value: $125,000

• Value basis for initial advance: $120,000

Wholesaler transaction guidelines specific to Virginia include:

• Assignment fees or double close price run-ups up to 20% of A-B price are eligible for financing.

• Financing assignment fees for MLS-listed properties may be disallowed.

• Full chain of contracts and wholesaler operating agreement required.

• No financing for finder’s or referral fees.

• Must be arm’s-length transactions.

Construction Holdback

The construction holdback component of your Virginia hard money loan is distributed through draw requests and reimburses verified progress against your approved scope of work. This ensures you have funds available as you complete renovations on your Virginia investment property.

If you possess sufficient liquidity to finance the rehab yourself and prefer to exclude a construction holdback, you may opt out of this component.

For loans of $100,000 or more in Virginia, interest is charged only on the funds actually disbursed from the construction holdback (referred to as “As Disbursed” interest accrual).

Appraisal and In-house Valuation

A valuation is required for all OfferMarket hard money loans in Virginia. Depending on your transaction and property type, we may require a third-party interior appraisal, exterior appraisal, or an in-house valuation.

In-house Valuation Criteria for Virginia

Even if you qualify for in-house valuation, OfferMarket may require an interior or exterior appraisal at its discretion.

Exterior Appraisal

Exterior appraisals are acceptable for Virginia transactions involving:

• REO sales

• Foreclosure auctions

• Sheriff’s sales

• Online auctions

• Bankruptcy sales

Exterior appraisals must be dated within 120 days of settlement. If between 120 and 180 days old, a recertification is required.

Interior Appraisal

Transactions not qualifying for exterior or in-house valuations require a full interior appraisal for Virginia properties:

OfferMarket orders appraisals via appraisal management companies (AMCs). Borrowers pay appraisal invoices; loans with unpaid appraisal fees remain on HOLD until payment is received.

Appraisal Transfer

Virginia borrowers may transfer appraisals not ordered by OfferMarket if:

• Appraisal was ordered through an approved AMC

• Appraisal is less than 180 days old at loan closing

• Appraisal is re-certified if between 120 to 179 days old

• Transferring lender provides:

  • Signed transfer letter certifying compliance with Appraiser Independence Requirements (AIR)

  • Appraisal report (PDF and XML)

  • Paid appraisal invoice

Scenario: Stabilized Hard Money Loan in Virginia

If the Virginia property shows no deferred maintenance and has an appraisal condition rating of C4 or better, OfferMarket funds up to 75% of the “As Is” value. This “stabilized” scenario suits properties ready to rent or sell without significant rehab.

Key Loan Details for Virginia Hard Money Loans

Extensions

Hard money loans in Virginia are designed to be short-term, typically ranging from 12 to 24 months. Most loans are paid off well within the initial 12-month term. Extensions should be avoided as best practice since they incur additional fees, interest, and increase the risk of foreclosure if repayment is delayed beyond the extension period.

To minimize the need for extensions in the Virginia real estate market, focus on avoiding:

• Working with general contractors who have limited experience or poor references specific to Virginia building codes and standards.

• Overly aggressive rehab scopes relative to your experience and liquidity in the Virginia market.

• Projects in Virginia areas with slow zoning or permitting processes, which can cause delays.

• Situations where you do not have immediate access to the property (e.g., tenants with active leases or eviction processes).

• Investments without a clear dual exit strategy (sale or refinance), especially important in volatile Virginia markets.

Extension Limits

If you have not repaid your Virginia hard money loan by the end of the term, you may request an extension of up to 50% of the original loan term. Extensions can be requested in increments of 3 or 6 months, subject to terms and fees outlined below.

Extension Terms and Fees

Extension fees for Virginia loans are added to your payoff statement according to the following schedule:

Extension Prerequisites

Before granting an extension on a Virginia hard money loan, you must confirm that your builder’s risk insurance policy remains active and effective throughout the entire extension period.

Ineligible Property Types in Virginia

The following property types are ineligible for funding through our Virginia hard money loan program:

• Mixed-use buildings

• Multifamily properties with 5 or more units

• Condotels

• Co-ops

• Mobile or manufactured homes

• Commercial properties (retail, office, industrial)

• Cabins or log homes

• Properties with active oil or gas leases

• Operating farms, ranches, or orchards

• Vacation or seasonal rental properties

• Unique, exotic, or luxury properties

• Properties accessed only by unpaved or dirt roads

Exception Scenarios for Virginia Loans

We may consider exceptions for the following situations, but they require additional documentation and underwriting review:

• Guarantor credit scores between 660 and 679

• Leasehold properties (ground rent)

• Single-family properties sized between 500 and 699 square feet

• 2-4 unit properties with one or more units sized between 400 and 499 square feet

• Initial advance funding based on “As Is” value higher than cost basis

• Non-arm’s length transactions

Borrower and Guarantor Requirements for Virginia Hard Money Loans

Liquidity Verification

To ensure adequate liquidity, we verify that Virginia loan guarantors have sufficient liquid assets to cover estimated cash to close plus 25% of the rehab budget. Eligible liquid assets include:

• Personal and business bank accounts

• Brokerage accounts in personal or business names

• Retirement accounts in personal names (subject to a 50% haircut due to restricted access)

Verification requires the two most recent statements for each account. No seasoning period is required for new accounts, but explanations may be requested for unusually large deposits.

While having a dedicated business bank account is recommended for accounting and risk management, it is not mandatory.

Aside from the cash to close, confirmed on your Virginia settlement statement, you do not need to move funds from your verified accounts.

Credit and Background Items

For Virginia borrowers:

• If three credit scores appear on a tri-merge report, we use the middle score.

• If two scores appear, we use the lower one.

• If there are no mortgage tradelines, six months of interest reserves are required.

• Borrowers with fewer than five tradelines also need six months of interest reserves.

• Bankruptcy must be discharged at least four years prior to loan settlement.

• Foreclosure must be completed at least four years prior.

• Bankruptcies or foreclosures between four and seven years ago may require three months of interest reserves.

• Late mortgage payments within the last 12 months require a letter of explanation and may impact eligibility.

• All past due balances on mortgage and non-mortgage tradelines must be paid before funding.

• Any involuntary liens or judgments (e.g., tax liens, child support) must be satisfied before funding.

• Pending civil lawsuits require a letter of explanation and loan committee review.

• Pending criminal lawsuits or convictions for financial or serious crimes render borrowers ineligible.

• Repeat offenses require a letter of explanation and loan committee discretion.

Interest Reserves

Interest reserves are funds collected at settlement and held in escrow to cover accrued interest before monthly payments begin. For Virginia loans, interest reserves depend on credit scores and background history:

Financed Interest Payments

To protect your liquidity and credit score during rehabilitation, Virginia borrowers may qualify for financed interest payments, which add accrued interest to the payoff balance rather than requiring monthly payments.

For example:

• Loan Amount: $100,000

• Interest Rate: 12%

• Loan Duration: 9 months

• Accrued Interest: $9,000 (calculated as $100,000 × 12% ÷ 12 × 9)

• Payoff Statement Includes:

  • Unpaid principal: $100,000

  • Unpaid interest: $9,000

Property Sourcing Guidelines for Virginia

Key points for sourcing properties in Virginia include:

• New market transactions require a General Contractor agreement or a letter explaining why a GC is not needed.

• Properties with previous sale price increases, wholesaler deals, or non-arm’s length transactions require additional documentation and review.

• Condos, conversions, and significant renovations must be supported with architect or engineer letters or permits.

• Submissions should include purchase contracts, settlement statements, payoff letters if applicable, track records, and entity formation documents.

Insurance Guidelines for Hard Money Loans in Virginia

Proper insurance protects your Virginia property and business. Hard money loan insurance—also called Builders Risk or Fix and Flip insurance—is a specialized package for properties under construction, vacant, or in poor condition.

Coverages and Limits

Coverage Details

💡 Pro tip: As soon as you take ownership of your Virginia property, install smoke detectors, locks, and security cameras. This compliance helps avoid denied insurance claims and protects your investment.

Frequently Asked Questions

What states does OfferMarket fund hard money loans in?

OfferMarket funds hard money loans across numerous states including Virginia, ensuring compliance with local regulations and market conditions specific to the Commonwealth.

Can I have multiple hard money loans at the same time in Virginia?

Yes, Virginia investors often hold several hard money loans concurrently. However, we prioritize risk management and may discuss loan pacing or liquidity concerns to ensure your financial safety.

Are hard money loans considered commercial loans?

Yes. Since loans are issued to business entities (LLCs or Corporations), hard money loans are classified as commercial, even though they finance residential properties in Virginia.

What is the minimum loan amount in Virginia?

The minimum loan amount for Virginia properties is $25,000.

Which property types are eligible in Virginia?

We finance non-owner occupied 1-4 unit residential properties, including single-family homes, townhomes, small multifamily units (2-4 units), and warrantable condos.

How is Loan-to-Value (LTV) calculated?

For hard money loans in Virginia, LTV usually refers to loan-to-after-repair-value (LTARV). The initial advance is based on the lower of contract purchase price or appraised “As Is” value. LTARV is calculated by dividing the total loan amount by the estimated post-repair value.

What are the credit requirements for Virginia loans?

A minimum FICO score of 680 is required, with exceptions considered between 660-679. Credit scores of all personal guarantors are reviewed.

What experience is required?

Experience is not mandatory but can increase leverage. Experience is measured by verifiable rehab projects similar in scope to the current Virginia deal.

Does wholesaling count towards experience?

No. Wholesaling does not count as experience since it does not involve financial responsibility for rehab completion.

What are the documentation requirements for Virginia hard money loans?

Purchase Transaction Requirements

Refinance Transaction Requirements

Are There Special Requirements for Loans Over $1 Million in Virginia?

Glossary of Key Terms

Instant Hard Money Loan Quote for Virginia Investors

OfferMarket Capital LLC is a premier private lender specializing in 1-4 unit residential real estate investments throughout Virginia. Our expertise lies in hard money loans and DSCR loans tailored for the Virginia market. We are dedicated to helping you build wealth through real estate by providing flexible, reliable financing solutions.

Thousands of Virginia real estate investors rely on OfferMarket every month. Membership is completely free and provides access to:

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