Comparing Denver hard money lenders is a structured exercise rather than a shopping trip. You are pricing seven independent variables: points, interest accrual basis, advance against purchase, advance against rehab, draw mechanics, extension terms, and the exit conditions attached to an early payoff. What follows is a framework for reading quotes side by side. It names no lenders and ranks none.
Which numbers on a Denver term sheet actually decide the deal?
The variables that decide what a Denver hard money loan costs are the ones charged once at closing and the ones that govern how much of your renovation budget the lender will actually fund. Rate is the number borrowers anchor on, and on a nine-month hold it moves total cost least.
The reason is duration. A loan on a Capitol Hill four-unit conversion or an Arvada retail repositioning is a months-long instrument, not a thirty-year one. Points are charged once, in full, at close, while interest accrues over a short window and, on a well-drawn facility, only on funded dollars. Move a quote from two points to three and you have added a fixed cost on day one; move the coupon a quarter point and you have added a rounding error across three quarters.
The questions below are the ones that make two quotes genuinely comparable.
| Term sheet line | The question that makes quotes comparable | What a vague answer usually hides |
|---|---|---|
| Points / origination | How many points, charged on the commitment or on the funded balance, and are they earned at close? | Points priced against the full commitment while only part of it ever funds |
| Interest accrual | Does interest accrue on the whole loan amount or only on dollars actually drawn? | Full-balance accrual on an undrawn rehab holdback |
| Purchase advance | At my contract price, what dollar amount do you fund at closing? | A percentage quoted against as-is value rather than against price |
| Rehab advance | What share of my budget do you fund, and is the cap set against after-repair value or total project cost? | A secondary cap that binds before the stated percentage does |
| Draw cycle | How many business days from a complete request to a wire, and what did your last hundred draws actually run? | An advertised cycle that excludes inspection scheduling |
| Extension | Is it a right or a request, what conditions vest it, and what does it cost? | Sole-discretion language priced as though it were a contractual right |
| Exit conditions | What prepayment penalty, minimum interest or exit fee applies if I refinance early? | Minimum interest that makes an early payoff no cheaper than riding to maturity |
Table: the seven term sheet lines to normalize before comparing Denver hard money quotes.
Points and rate are not the same kind of cost
Points are a fixed charge levied once at closing, and rate is a running cost that accrues over the hold. Which balance each applies to is a term, not a convention: points may be charged on the committed amount or on the funded balance, and interest may accrue on the whole commitment or only on drawn dollars. The table below prices both conventions, because a term sheet that pairs the expensive version of each can cost more than a higher headline rate. That difference is why a two-point quote at a higher rate often beats a three-point quote at a lower one over twelve months.
Treat them as separate line items rather than blending them into one cost-of-capital figure. Points are sunk the moment you close, regardless of hold length or how much of the facility you use. Interest is a function of balance and time, and you control both.
The practical test: ask each lender for a total dollar cost at your expected hold, assuming your actual draw schedule. A lender who cannot produce that number from their own term sheet is telling you something useful about how the file will be administered later.
The accrual question that changes everything: if interest accrues on the full commitment including an undrawn rehab holdback, your effective cost on a phased scope is materially higher than the coupon implies. Get this in writing, not on a call.
Two leverage tests: against the buy, and against the budget
Every hard money term sheet contains two separate leverage constraints, one governing your cash at closing and one governing whether the scope you underwrote can be built. Borrowers routinely read them as a single number. Ask which test binds first on your specific deal.
The purchase-side advance is usually expressed against purchase price or as-is value, whichever is lower. On a Denver acquisition bought below market, that "lower of" language is the entire negotiation: a lender underwriting to as-is value gives you the benefit of your basis, and a lender underwriting to contract price does not. Corporate Finance Institute puts the typical hard money advance at 65% to 75% of the collateral asset's value, with principal and interest expected back within one to five years.
The rehab-side advance is where quotes diverge most. Some programs fund the full budgeted scope in arrears, some fund a share of it, and some cap the combined loan against after-repair value or against total project cost. Those are three different tests, and on any given deal one of them binds before the others.
The question that ends the ambiguity: "At my purchase price and my rehab budget, what is the maximum dollar amount you will fund, and which of your tests produced that number?" A dollar answer is comparable across quotes; a percentage answer is not.
What should I ask a Denver lender about draws?
Ask for three numbers: how many business days pass between a complete draw request and a wire, what triggers an inspection, and how many draws the program allows. Those three answers determine whether your crew stays on site or stands down waiting to be reimbursed.
Hard money rehab funding is almost always reimbursement-based. You or your contractor pay for completed work and the lender funds it back, which means your working capital, not the loan, carries the float between request and wire. On a phased scope that float decides whether the schedule holds.
Inspection trigger: third-party inspection is standard across the Front Range. The real question is who schedules it and how quickly it clears.
Draw count and minimums: a facility capped at four draws with a minimum draw size behaves very differently on a staged renovation than one with unlimited draws.
Retainage: ask whether the lender holds back a percentage of each draw and when it is released, because retainage is a working capital cost that never appears in a rate comparison.
Our longer walkthrough of how hard money loans work in commercial real estate covers the underwriting side of draw administration in more depth.
An extension you did not negotiate is an extension you will overpay for
Extension terms are cheap to negotiate at origination and expensive to negotiate at maturity, because at maturity the lender holds every card and you hold a property mid-renovation. Get the length, the fee, and whether the extension is a contractual right or a discretionary favor.
Denver-area permitting timelines vary by jurisdiction, and a project crossing a municipal boundary can cross a scheduling regime too. That variance belongs in your base case, not your downside case.
Right versus request: a right that vests on stated conditions, typically the loan being current and the property having reached a defined completion threshold, is worth far more than language saying the lender may grant an extension in its sole discretion.
Cost and cadence: extension fees are generally quoted in points on the outstanding balance. Get the number, and get whether it is charged once or per extension period.
Underwrite the extended case: if a deal only clears assuming you exit exactly on the original maturity date, you have underwritten a schedule rather than a project.
What does a ten-day close actually commit a Denver lender to?
On its own, almost nothing, because a closing timeline quoted before anyone with credit authority has read your file is a marketing figure rather than a commitment. What matters is the sequence: who reviews what, in which order, and which conditions still sit between a term sheet and funding.
A soft indication subject to full credit review is a different instrument from a term sheet issued after credit has already read the file. Ask directly whether someone with authority to decline has seen the deal, and what remains outstanding.
The other half of speed is diligence load. A lender ordering a full appraisal and third-party budget review on every file is slower and more certain; one underwriting off a broker price opinion and your own scope is faster and reprices more often when the appraisal lands. Know which trade you bought.
Colorado shops and national programs solve different problems
Local Denver and Front Range lenders and national hard money programs tend to price closer together than borrowers expect, and to differ sharply on valuation judgment, flexibility mid-project, and what happens when a scope changes. Quote both on the same deal and compare structure, not headline cost.
Where local shops usually differ: they will underwrite an unusual Colorado asset, such as an infill assemblage near a transit station or an older Lakewood commercial corner, that does not fit a national credit box, and they reshape draw schedules mid-project more readily.
Where national programs usually differ: they price consistently, close repeatedly on the same document set, and more often offer a defined path from short-term debt into a term takeout. Across six deals, documentation consistency carries real value.
Where they are identical: both will hold you to the appraisal, and neither will fund a scope that after-repair value cannot support.
Program-level detail on the product itself sits on the hard money loans page.
The September 2026 rate backdrop behind every Denver quote
Short-term real estate credit prices off the front end of the curve while your exit gets underwritten against the long end, so a hard money decision depends on both. As of September 3, 2026, SOFR stood at 3.66% and the 10-year Treasury at 4.77%, per Federal Reserve Bank of St. Louis data.
That relationship is the shape of the trade: your coupon sits above the front end while your refinance or sale is priced against the long end, so a longer-than-planned hold gets expensive in two directions at once.
On the credit side, CBRE's Lending Momentum Index registered 1.0 at the end of Q2 2026, easing from a five-year high of 1.5 in Q1 and below the 1.3 reading a year earlier, with the number of commercial loans up 11% year over year and average loan size up 5%, according to CRE Daily's brief on the release. The same brief reports commercial mortgage spreads tightening 21 basis points to 204 basis points, multifamily spreads tightening 15 basis points to 162 basis points, loan-to-value ratios slipping to 59.6% commercial and 63.3% multifamily, and alternative lenders taking 38% of non-agency closings against 30% for banks.
What this means for your quote: capital is competing on price rather than on leverage, so expect a firm answer on advance rate and a more negotiable one on points. It also means running more than one process is worth the effort, because the spread between quotes is where the competition is showing up.
Where the deals are: Denver submarkets
Denver short-term lending clusters where basis, entitlement timelines and exit liquidity line up, and that alignment varies considerably across the metro. Permits authorized across the Denver-Aurora-Lakewood MSA totaled 1,490 housing units in July 2026, per U.S. Census Bureau Building Permits Survey data.
RiNo: ground-up and adaptive-reuse density around the 38th and Blake transit node. Bisnow reported in June 2026 that a 16-story multifamily project broke ground at 3875 Walnut Street on a 28-month schedule delivering in fall 2028, inside a mixed-use plan that also carries a 180-room hotel and 310 workforce housing units at 60% to 90% of area median income. Short-term capital here usually bridges land, entitlement or pre-construction rather than a cosmetic rehab.
Capitol Hill: older small multifamily and unit-count conversions where the binding constraint is the comp set and the age of the building's systems. Lenders underwrite these to the appraiser, so leverage follows valuation rather than sponsor conviction.
Aurora: the metro's volume market for small multifamily and neighborhood retail repositioning, spanning multiple jurisdictions. Build the permitting variance into the maturity you negotiate, not the extension you hope to receive.
Lakewood: aging commercial strip and mixed-use corners along the west-side corridors, frequently the deals that need a lender willing to underwrite an unusual scope instead of a template.
Littleton and Arvada: suburban small multifamily and retail repositioning with deeper, more comparable-driven sale evidence. Easier to appraise generally translates into cleaner leverage and fewer valuation surprises at close.
For the wider metro picture, see our Denver market hub; for statewide context, Colorado.
The bottom line
Build the sheet before you take the call. Seven columns, one row per quote: points and what they are charged on, accrual basis, purchase advance in dollars, rehab advance in dollars, draw cycle in business days, extension right and fee, exit conditions. Normalize each quote to a total dollar cost at your realistic hold, not your optimistic one. The lowest headline rate is rarely the cheapest, and the gap is knowable before you sign.
If you would rather have the comparison run than assemble it by hand, a 5-minute submit puts your deal in front of 5,000+ loan programs and returns 5–8 matches, with a median first offer in under an hour, $0 upfront, and a success fee of 0.50–1.00%.