Short answer: A hard money down payment is set by the lender's loan-to-value and loan-to-cost limits, not by a fixed percentage. At All Inclusive Realty Group, a hard money loan can be up to 70% of the property's as-is value, so when you buy at a price equal to as-is value, you bring the other 30% plus closing costs.
By Gary Burmaster, Realtor and property manager at All Inclusive Realty Group. Updated October 25, 2026.
Investors ask "how much down?" as if there were one answer. With a bank loan there often is, because the bank prices the borrower. A hard money lender prices the property. The down payment falls out of two numbers the lender publishes: how much it will lend against the property's value, and how much it will lend against the total cost of the project. Once you know those two numbers, you can work out your cash needed before you ever call a lender. This guide shows the math, explains what else you will need in cash, and covers how AIRG's Direct Lending division sizes its loans.
How do hard money lenders decide the down payment?
Hard money lenders underwrite the asset and the exit more than the borrower's income. At AIRG we lend on the property's as-is value, your equity and a confirmed exit, with minimal income paperwork. Two limits do most of the work:
- Loan-to-value (LTV). The loan as a percentage of the property's value. Our hard money loans go up to 70% of as-is value, and our bridge loans go up to 65%.
- Loan-to-cost (LTC). The loan as a percentage of the total project cost, purchase plus rehab. Our hard money loans go up to 85% LTC.
Both are maximums, so the lower of the two results sets the ceiling on the loan. Whatever the loan does not cover is your down payment and your share of the rehab.
How do I calculate my hard money down payment?
Start with the as-is value limit. These examples use AIRG's published maximums. They are illustrations, not loan offers.
| Scenario | Value | Maximum loan | Your cash before closing costs |
|---|---|---|---|
| Hard money purchase at as-is value | $400,000 price and as-is value | 70% = $280,000 | $120,000 (30%) |
| Hard money purchase at as-is value | $250,000 price and as-is value | 70% = $175,000 | $75,000 (30%) |
| Bridge loan against owned property | $400,000 value | 65% = $260,000 | Equity of $140,000 stays in the property |
Then check the cost limit if you are renovating. With an 85% loan-to-cost maximum, the loan cannot exceed 85% of the purchase price plus the rehab budget, so at least 15% of the total project cost is yours even before the value limit is applied. Your term sheet shows the actual loan amount for your deal, and with AIRG you get a term sheet in 24 to 48 hours.
What other cash do I need besides the down payment?
- Closing costs. Escrow, title and the costs shown on your term sheet.
- Your share of the rehab. Any renovation the loan does not cover.
- Carrying costs. Loan payments, insurance, utilities and property taxes while the property is being renovated, rented or sold.
- A contingency. Older Sacramento homes often reveal plumbing, electrical or foundation work once walls are opened. Budget for it.
Investors who run out of cash usually do it in the middle of the project, not at closing. Plan the whole project, not only the down payment.
Can I borrow the full purchase price with hard money?
Not at AIRG's published limits. With a 70% loan-to-value maximum on hard money and 65% on bridge loans, the borrower always has equity in the deal. That equity is what makes fast, asset-based lending possible: the lender is secured by a first deed of trust on the property, and the borrower has real money at risk too.
There are ordinary ways investors reduce the cash they personally bring: buying below as-is value, partnering with another investor, or using equity in a property they already own through a bridge loan. Each one has its own risks, and each should be on paper before you sign a purchase contract.
How is a hard money down payment different from a bank loan down payment?
A bank starts with you: your income, your credit history, your debt ratios and your tax returns. The property matters, but the file is built around the borrower, and that takes time. A hard money lender starts with the property: what it is worth today, what you are paying, what you plan to do with it and how the loan gets paid off. That is why hard money can close in days instead of weeks, and why the down payment is tied to value and cost rather than to a borrower profile.
The trade-off is the term. Hard money and bridge loans are short. Ours run 6, 12 or 18 months for hard money and 3 to 12 months for bridge. The down payment is only half the plan. The other half is the exit: the sale, refinance or long-term loan that pays the short-term loan off on time.
What down payment mistakes do Sacramento investors make?
- Using after-repair value for the down payment math. Our hard money limit is set on as-is value. Plan with the value the property has today.
- Forgetting the rehab share. The loan-to-cost limit means part of every renovation dollar is yours.
- No cushion for carrying costs. A project that runs two months long needs two more months of payments, insurance and utilities.
- An exit with no numbers. "I will refinance" is not an exit until the rent or sale price that supports it is on paper.
What does AIRG's Direct Lending division offer?
| Term | Hard money | Bridge |
|---|---|---|
| Used for | Fix-and-flip projects, distressed purchases and fast closes | A near-term purchase to a longer-term refinance or a sale |
| Loan size | $100K to $1M | $150K to $800K |
| Term | 6, 12 or 18 months | 3 to 12 months |
| Maximum loan-to-value | 70% of as-is value | 65% |
| Maximum loan-to-cost | 85% | Shown on your term sheet |
All loans are for investment property only and are secured by a first deed of trust on California investment property. We lend in the Sacramento area plus El Dorado, Placer, Sutter, Yolo, Solano and San Joaquin counties. You get a term sheet in 24 to 48 hours, and we close through escrow in 7 to 10 days. Pricing is quoted on your term sheet for your specific deal.
What makes a hard money loan application go faster?
- The property address, purchase price and a realistic as-is value.
- A rehab scope and budget if you are renovating.
- Your exit: sale, refinance or hold, with the numbers behind it.
- Proof of the cash you will bring to closing.
- Your escrow and title contacts.
Frequently asked questions
What is the typical down payment on a hard money loan?
It depends on the lender's loan-to-value and loan-to-cost limits. At AIRG, hard money loans go up to 70% of as-is value, so buying at as-is value means bringing 30% of the price plus closing costs. Bridge loans go up to 65% loan-to-value.
Is a hard money down payment based on purchase price or value?
Lenders size the loan against value, cost or both. AIRG publishes a 70% maximum loan-to-value on as-is value and an 85% maximum loan-to-cost for hard money. The lower result sets the loan, and your term sheet shows the number.
Do hard money lenders check income?
Less than banks do. AIRG underwrites on the property's value, your equity and a confirmed exit, not W-2s or personal income ratios, with minimal income paperwork.
How fast can I get a hard money loan in Sacramento?
With AIRG you get a term sheet in 24 to 48 hours and close through escrow in 7 to 10 days, on investment property in the Sacramento area and nearby counties.
Can I use a hard money loan on my own home?
Not with AIRG. Our hard money and bridge loans are for investment property only, secured by a first deed of trust on California investment property.
Have a deal in front of you? Request a term sheet and see your loan amount and cash needed in 24 to 48 hours.
Not a commitment to lend. All loans are subject to final underwriting approval. Loan examples are illustrations, not offers. This content is for informational and educational purposes only and is not financial, tax or legal advice. Equal Housing Opportunity.
