Long Island Hard Money Costs vs Kiavi: Full Comparison

Why does local hard money lending beat national almost every time? Here's why:

Yesterday, a successful fix-and-flip investor called my office. He'd been using Kiavi for three deals and just discovered he'd left over $47,000 on the table in hidden fees and lost opportunities. The kicker? He thought he was getting a great rate.

After funding a steady stream of Long Island real estate deals, I've seen this story play out too many times. Investors focus on the advertised interest rate while missing the total cost picture. It's like buying a car based solely on the monthly payment without considering the down payment, term length, or dealer fees.

Here's what really matters when comparing hard money lenders: speed of funding, total loan costs including all fees, local market expertise, and relationship flexibility when deals need adjustments. I'm going to break down exactly how these factors impact your bottom line when choosing between a local Long Island lender and a national player like Kiavi.

In This Article:

• The True Cost Breakdown Nobody Talks About
• Speed Is Money in Long Island's Market
• Why Local Knowledge Saves Deals
• Hidden Fees That Kill Your Profits
• Draw Schedules: Hours vs. Weeks
• When Relationships Matter Most
• Real Numbers from Real Deals
• Your Next Steps

The True Cost Breakdown Nobody Talks About

Interest rates are the shiny object that distracts from total loan costs. It's common for an experienced investor to call me saying Kiavi offered them 10% and I'm quoting 12%. Then I pull out my calculator and show them the full picture.

Start with origination points. Kiavi typically charges 2-3 points upfront. On a $500,000 loan, that's $10,000 to $15,000 before you've picked up a hammer. Add their application fees, underwriting fees, document preparation fees, and wire fees. Now factor in the extension fees when your project runs long because their draw process delayed your contractor.

Here's what most investors miss: time costs. When Kiavi takes three weeks to approve your loan while the seller gets nervous, you're either losing the deal or paying more to keep them happy. I've successfully helped investors close deals where the seller needed funds in 72 hours. Try getting that timeline from a call center in Utah.

The math gets worse when you calculate opportunity cost. Every day waiting for approval or funding is a day you're not renovating. In Long Island's market, where carrying costs run $3,000 to $5,000 monthly, a two-week delay costs you real money.

Speed Is Money in Long Island's Market

Nassau County's median price sits at $840,000 while Suffolk County runs $690,000. At these price points, sellers have options. They're not waiting around for buyers struggling with financing. When you find a distressed property in Huntington or a flip opportunity in Valley Stream, you need to move FAST.

My process is simple: application in 60 seconds, drive-by within hours, term sheet in 24 hours or less. Compare that to Kiavi's process: online application, wait for an analyst somewhere to Google Street View your property, get questions from someone who's never been to Long Island, wait for committee approval, then hope the closing goes smoothly.

Last week, I funded a deal in Massapequa where the investor called me Tuesday morning about a foreclosure auction happening Thursday. By Tuesday afternoon, I'd driven by the property, confirmed the ARV with local comps, and provided proof of funds. He won the auction with confidence, knowing exactly what he could bid.

Speed isn't just about beating other buyers. It's about capitalizing on sellers' urgency. Distressed sellers facing foreclosure, estates needing quick liquidation, divorces requiring fast resolution – these situations create opportunities, but only if you can deliver certainty and speed.

Why Local Knowledge Saves Deals

Living and investing in this market for decades gives me insights no algorithm can match. I know that a flip in Levittown has different dynamics than one in Port Washington. I understand why certain blocks in Hempstead are goldmines while others two streets over are risky.

When an investor shows me a property near the Hicksville train station, I immediately know the buyer pool, the renovation standards expected, and the realistic timeline for resale. Someone sitting in Kiavi's office looking at data on a screen sees numbers. I see neighborhoods.

This knowledge translates directly to your success. When your contractor disappears mid-project, I have three reliable replacements I can recommend today. Captain Permit handles our expediting because they know every building department from Elmont to Montauk. My attorney and title team work locally and can resolve issues in person, not through email chains.

Kiavi recently pulled out of Florida markets entirely. Think about that. One day you're building relationships, the next day they're gone. Some corporate executive made a spreadsheet decision that destroyed countless investor relationships. That's not happening with local lenders who live, work, and invest in the same market as you.

Hidden Fees That Kill Your Profits

Kiavi's loan documents run 40+ pages for a reason. Buried in that paperwork are fees that surprise investors at closing and throughout the project. Processing fees, document preparation charges, inspection fees for every draw, extension fees, prepayment penalties, default interest rates that trigger on technicalities.

I recently reviewed a Kiavi loan package for an investor. Beyond the obvious costs, I found: $495 application fee, $1,500 underwriting fee, $395 for each inspection, $500 document prep, $750 for extensions, plus third-party fees they mark up. On a typical six-month flip, these added $8,000 to $12,000 beyond the stated rate and points.

My fee structure fits on one page because transparency builds trust. You pay points and interest, period. No surprise inspection fees because I drive by your project myself or send someone from my team. No document prep charges because that's part of doing business. No extension penalties that punish you when permits take longer than expected.

The worst hidden cost? Rigid terms that can't adapt to reality. When Long Island's permit process delays your project, you need a lender who understands, not one who triggers default rates because you crossed day 181 of a 180-day loan.

Draw Schedules: Hours vs. Weeks

Nothing kills contractor relationships faster than delayed draw payments. Your contractor finishes the kitchen, needs payment to start the bathrooms, but your lender's draw process takes two weeks. Now your project stalls, your carrying costs mount, and your contractor moves to another job.

Kiavi requires their third-party app for draw requests. Upload photos, wait for remote inspection scheduling, wait for approval, wait for funding. Each step adds days while your project sits idle. Contractors learn which investors pay quickly and which ones make them wait. Guess who gets priority when schedules get tight?

My draw process is different because I'm LOCAL. You call or text when a phase completes. I drive by that day or next, confirm the work, and wire funds often within hours. Sometimes I'm checking progress anyway because I'm in the neighborhood looking at other opportunities.

This speed keeps your renovation moving. Your contractor stays on-site, your timeline stays intact, and your carrying costs stay controlled. On a typical flip with four draws, the time difference between my process and Kiavi's can save you three to four weeks of carrying costs.

When Relationships Matter Most

Real estate investing isn't just about numbers on spreadsheets. When deals hit unexpected challenges, you need a lender who problem-solves, not one who quotes policy manual sections.

An investor recently discovered foundation issues during demolition. The repair added $30,000 and six weeks to his project. With Kiavi, that triggers forms, committees, and potential loan restructuring. With me, it was a phone conversation, a quick site visit, and an adjusted draw schedule. Problem solved in 48 hours, not two weeks.

When you call Kiavi, you get whoever answers the 800 number. They don't know your project, your track record, or your market. Every conversation starts from zero. When you call me, you're talking to the person who underwrote your loan, who's driven by your property, who's invested in your success.

This relationship extends beyond single deals. As you grow from one flip to multiple projects, from residential to mixed-use, from Long Island to expanding into other markets, you need a funding partner who grows with you. Corporate lenders have rigid boxes. Local lenders have flexibility.

Real Numbers from Real Deals

Let me share real examples from recent Long Island deals comparing total costs:

Scenario 1: $400,000 Purchase in Babylon
Kiavi's Structure: 11% interest, 2.5 points, $3,000 in various fees, 14-day draw process
Total project time due to delays: 7 months
Total cost: $42,500

Local Lender Structure: 12.5% interest, 1.5 points, no additional fees, same-day draws
Total project time: 5 months
Total cost: $32,500

The investor saved $10,000 despite the higher interest rate, plus sold the property six weeks sooner in a strong market.

Scenario 2: $650,000 Purchase in Great Neck
Kiavi quoted terms but needed three weeks for approval. The seller accepted another offer. Deal lost.
Local lender provided approval and proof of funds in 24 hours. Deal closed in 10 days.

Opportunity cost of the lost deal? The investor estimated $75,000 in profit gone because financing couldn't move fast enough.

These aren't cherry-picked examples. They represent the REALITY of hard money lending where execution matters more than advertised rates.

Your Next Steps

Stop shopping rates and start evaluating total value. Here's your action plan:

First, calculate the true cost of your current lending relationship. Add up all fees, estimate time delays, and factor in missed opportunities. You might be shocked by the real number.

Second, test response time. Call your current lender with a hypothetical urgent deal. How quickly can they provide proof of funds? How fast can they close? If the answer involves committees and processes, you're leaving money on the table.

Third, evaluate your team. Your lender should be more than a money source. They should connect you with contractors, attorneys, and other professionals who make deals happen. If you're just a loan number, you're missing the relationship value.

Schedule a conversation before you need funding. The worst time to establish a lending relationship is when you're under contract with a ticking clock. Meet your lender, understand their process, get pre-approved so you're ready when opportunity knocks.

Success in Long Island real estate investing requires more than finding deals. It demands execution speed, total cost management, and relationships that survive market cycles. Local hard money lenders provide advantages that no national corporation can match.

The market rewards investors who move fast, control costs, and build strong local relationships. Every successful flipper I know prioritizes execution over advertised rates. They understand that in real estate, like in life, you get what you pay for. Sometimes paying slightly more upfront saves you substantially more in the long run.

Ready to see how much you could save with truly local lending? Stop letting hidden fees and slow processes eat your profits. Apply online or call my office. Let's review your next deal and calculate the REAL numbers that matter to your bottom line.