Hard Money Loans for Short-Term Rentals in Texas

Frequently Asked Questions

What are hard money loans and how do they work for real estate investors?

Hard money loans are short-term real estate loans used by investors who need to close quickly or bypass traditional lending restrictions. In Texas, they’re commonly used for flips, rental acquisitions, and fast refinances. These loans are secured by the property itself and are approved based on asset value and investment strategy—not personal financials. Terms typically range from 6 to 36 months and include interest-only payments. Texas investors use hard money to stay competitive and close on high-return opportunities fast.

When should an investor consider using a hard money loan instead of a conventional loan?

Texas investors should consider hard money loans when speed, flexibility, or non-traditional circumstances make bank loans unworkable. These loans are ideal for auctions, LLC purchases, or deals involving distressed properties. If you’re self-employed, working on a tight timeline, or unable to provide full income documentation, hard money provides a faster alternative. Approval is based on the deal’s structure and the value of the asset, helping you secure real estate that others may miss due to lender delays.

What makes hard money different from other types of financing?

Hard money loans focus on the property, not the borrower—offering faster closings, fewer requirements, and more flexibility than traditional financing. In Texas, this helps investors navigate dynamic, fast-paced markets. Traditional loans often require weeks of processing, credit reviews, and full documentation. Hard money skips that red tape, allowing closings in under 10 days. Though interest rates are higher, the time saved often leads to greater profit margins, especially for short-term real estate strategies.

What are the typical loan terms for a hard money loan?

In Texas, hard money loans typically range from 6 to 36 months and feature interest-only payments. Purchase loan-to-value can reach up to 85%, and refinance LTVs generally go up to 80%. These loans usually include origination fees and may require reserves based on deal type. Designed for flips, short-term rentals, and transitional investments, hard money loans in Texas are structured to close fast—helping you seize opportunities in high-demand markets with minimal delays.

How quickly can a hard money lender close a deal?

Hard money lenders in Texas typically close in 3 to 10 business days. This fast timeline is a key advantage in auctions, off-market acquisitions, and hot short-term rental markets. Because approval is based on property value and investment plan—not income or credit—investors can avoid the delays of bank underwriting. Whether you're operating in Austin, Houston, or a coastal market like Galveston, this speed helps you lock in high-yield properties and stay ahead of the competition.

Can I get a hard money loan in Texas with poor credit or no income documentation?

Yes. In Texas, many real estate investors qualify for hard money loans even with low credit scores or no documented income. These loans are based on the property’s value and the strength of your investment plan—not your personal financials. While Texas enforces fair lending and licensing rules, most business-purpose loans are exempt from consumer protections. It’s important to work with a transparent, licensed lender to ensure full compliance with state laws and a secure transaction.

Explore hard money loans and other Airbnb loans in neighboring states like Oklahoma and Louisiana to pursue more opportunities beyond Texas.