Private Money Mortgage Rates: What Beginner Flippers Need to Know Coming into the new year
As we move into 2026, private money lending remains a cornerstone of financing for real estate investors pursuing fix‑and‑flip projects. Unlike traditional bank loans, private money, whether accessed through a broker or a direct lender, is asset‑based, short‑term, and built for speed, allowing investors to close quickly and begin renovations without delay. That convenience, paired with the higher risk profile of these loans, continues to keep rates on the higher end of the spectrum.
Current market trends show that private money interest rates are holding steady, with no meaningful drop from recent norms. At THINK, we’ve been tracking this closely, and while “bait rates” may look appealing, actual closing‑table rates tell the real story: the cost of flip capital hasn’t moved. Typical fix‑and‑flip rates remain in the 8%–12% range. Experienced borrowers with strong deals may land closer to 8%–10%, but rates dropping to 5% is about as realistic as Bigfoot riding a unicorn while juggling kittens and singing ’80s yacht rock. Newer investors or higher‑risk projects often see rates in the 12%–12.75% range. Points and origination fees (1%–4%) also factor into the true cost of capital, and we’re seeing those begin to tick upward as well.
For newer investors, partnering with lenders who offer transparent terms, fast turnarounds, and a desire to build long‑term relationships can help keep costs predictable. Always compare lenders and build accurate cost projections into your rehab budget—but avoid over-shopping your deal. Excessive shopping creates delays, frustrates lenders and borrowers alike, and can ultimately cost you the opportunity. In short: the grass isn’t always greener, kids.
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