Real estate investing is all about speed, strategy, and smart financing. When the right property opportunity comes along, you don’t want to lose it because a traditional bank drags you through endless paperwork. That’s where private money loans step in. They are fast, flexible, and designed for investors who need reliable funding without the hassle.

At RP Capital Lending, we’ve helped countless Florida investors flip homes, build rental portfolios, and fund new construction with private loans that are simple to structure and quick to close. This guide will walk you through the ins and outs of structuring a private money loan so you know exactly what to expect and how to make the most of this powerful tool.

What Is a Private (Hard Money) Loan?

A private money loan, often called a hard money loan, is a short-term real estate loan provided by a private lender instead of a traditional bank. The loan is secured by the property itself, making the process faster and more flexible than conventional lending.

The biggest difference is that private lenders focus on the value of the property and the project plan, rather than your credit history or employment records. That means if you find a great investment property, you can get funding quickly even if a bank wouldn’t approve you.

The benefits are clear: faster approvals, flexible loan terms, and easier access to capital. Of course, these loans come with higher interest rates than traditional mortgages, but the speed and flexibility often make them worth it for investors.

Step-by-Step: How RP Capital Lending Structures Your Loan

Step 1: Define Your Lending Range

The first step is setting the boundaries for the loan. At RP Capital Lending, we look at your project type whether it’s a fix-and-flip, rental acquisition, or construction project and then determine safe lending limits. This ensures you’re never over-leveraged and that the loan makes sense for both your goals and our risk standards.

Step 2: Set Loan Amount and Terms

This is where the loan really takes shape. We typically lend between 60% and 75% of the property’s value or After Repair Value (ARV). Loan terms are short, usually between six months and two years, depending on the project timeline.

Interest rates are competitive within the industry, and we keep origination fees straightforward so there are no hidden surprises. Repayment options can be interest-only with a balloon payment at the end or structured in a way that fits your cash flow. The goal is to make the loan work with your project rather than forcing your project to fit the loan.

Step 3: Draft a Clear, Legal Agreement

Once terms are agreed upon, everything goes into a formal contract. This loan agreement clearly states the amount, interest rate, repayment plan, and collateral securing the loan. It also outlines what happens in the event of late payments or defaults. We make these agreements simple and easy to understand so you can move forward confidently.

Step 4: Complete Due Diligence

Before closing, due diligence ensures that everything is in order. This may include checking the property’s title for existing liens, confirming the valuation, and filing the lien with the county to secure the lender’s interest. Funds are then disbursed through escrow, giving everyone confidence in the process. From start to finish, our team handles this quickly so you can get to work on your project.

Must-Have Elements in a Loan Document

Every private loan should include certain essentials. At RP Capital Lending, our agreements always cover the borrower and lender’s information, loan amount, interest rate, repayment plan, and loan duration. Collateral is detailed, usually the property being purchased or renovated, and the document will also explain what happens if payments are missed.

Another important part of the agreement is the prepayment clause. Some lenders penalize you for paying off early, but we keep terms clear and fair, so you always know your options. These elements make sure both sides are fully protected and expectations are clear from the beginning.

Licensing Requirements

Licensing rules vary depending on the state and the type of loan. In most cases, loans for non-owner occupied investment properties are structured with fewer restrictions than consumer-purpose loans. Since we are licensed in Florida, all of our lending practices comply with state regulations. That means when you borrow from RP Capital Lending, you’re working with a legitimate and compliant lender that puts your protection first.

Why Private Lending Works for Investors

Private lending offers unique advantages that traditional financing can’t match. For borrowers, it means faster access to capital. You can secure funding in days rather than waiting weeks or months for a bank. For lenders, private loans can deliver double-digit returns, often between 10% and 12%.

Most importantly, private lending is built on flexibility. No two deals are the same, and structuring a loan around the property, the project, and the exit strategy gives investors the freedom to act quickly and scale their businesses. Whether you’re flipping your first home or adding to a large portfolio, private lending adapts to your strategy.

Why Choose RP Capital Lending

There are many private lenders out there, but at RP Capital Lending, we pride ourselves on being more than just a source of capital we’re a partner in your real estate journey. Here’s what sets us apart:

• Fast closings so you don’t miss opportunities.

• Flexible structures designed around your project.

• No income proof required, because we lend based on the property, not your paperwork.

• Local expertise in Florida real estate, giving us a deep understanding of the market.

• Transparent terms with no hidden fees or confusing fine print.

We know that real estate investing moves fast, and our mission is to keep your funding just as fast and reliable.

Final Thoughts

A private money loan can be the key to unlocking your next real estate opportunity but it needs to be structured correctly. By defining the lending range, setting fair and clear terms, drafting a solid legal agreement, and completing due diligence, you can ensure your investment has the financial foundation it needs.

At RP Capital Lending, we’ve built our process to make private lending simple, transparent, and investor-friendly. Whether you’re flipping, renting, or building, we’re here to fund your vision and help you grow.

5 Frequently Asked Questions (FAQs)

1. What is a private money loan?
A private money loan is a short-term, asset-backed loan funded by private lenders, often used for real estate investing, fix-and-flips, and construction projects.

2. How fast can I get funded with RP Capital Lending?
We typically approve within 24 hours and can fund in just a few days—much faster than traditional banks.

3. What are the typical terms of a private money loan?
Loan terms usually range from 6 to 24 months with interest rates between 9–11% and flexible repayment options.

4. Do I need perfect credit to qualify?
No. Approval is based primarily on the property’s value and your exit strategy, not just your credit score.

5. Is RP Capital Lending licensed to provide loans?
Yes, we are licensed in Florida and operate fully within state regulations, ensuring secure and compliant lending for investors.