Your Long Island Hard Money Loan Requirements Checklist

You found a deal in Nassau County. The numbers work. The seller wants to close in less than two weeks. And your bank just told you they need 45 days minimum & Hard Money takes over 2 weeks. Sound familiar? I founded Equiquest in 2020 as a family-owned private lending firm, and over the past five years funding fix-and-flip and all types of bridge deals across Nassau and Suffolk counties, this scenario lands in my inbox almost daily. The good news is fast moving local private hard money lending exists precisely for moments like this. But walking in unprepared wastes everyone's time and kills deals that should close.

This checklist breaks down exactly what you need to bring to the table when applying for a hard money loan on Long Island. Not the vague advice you find on generic lending websites. The actual requirements I look at when somebody schedules time with me and says they have a deal.

In This Article

• Identity Verification and Background
• Business Entity Requirements
• Credit History Considerations
• Deal Documentation Package
• Team Readiness Assessment
• Financial Analysis Preparation
• Cash Reserves and Down Payment
• Property and Market Requirements
• Timeline and Closing Expectations

Identity Verification and Background

Let me start with the basics. Every hard money lender on Long Island needs to verify who you are. This sounds obvious but you would be surprised how many people show up to meetings without proper identification. Bring a valid government-issued photo ID. A driver's license works. A passport works. What does not work is a photocopy or an expired document.

Beyond the ID, expect a background check. I run these on every borrower. Not because I think everyone walking through the door has a criminal record. I run them because lending money secured by real estate carries risk, and understanding who I am doing business with matters. Any recent bankruptcies, judgments, or liens will surface during this process. Better to disclose these upfront than have them derail your loan approval later.

The background verification also includes confirming your social security number and verifying your identity against federal databases. This is standard practice across the industry and helps protect both the lender and legitimate borrowers from fraud.

Business Entity Requirements

Here is where newer investors often stumble. Hard money loans on Long Island require a business entity. You cannot take title to an investment property in your personal name and expect hard money financing. This is not a suggestion. It is a REQUIREMENT across essentially all private lenders in our market.

The most common structure is a Limited Liability Company. An LLC provides liability protection and creates the legal separation between your personal assets and your investment activities. To form an LLC in New York, you file Articles of Organization with the Department of State. You also need an operating agreement that documents how the LLC functions, even if you are the only member.

Bring your Articles of Organization to our meeting. Bring your operating agreement. Bring your EIN assignment letter from the IRS. And if you already have an established entity, bring a Certificate of Good Standing from New York State confirming your LLC is active and compliant. Missing any of these documents slows down your closing, and in competitive deals, slow means dead.

One thing I tell newer investors all the time. Get your entity set up before you start looking at properties. The paperwork takes time. You do not want to find the perfect fix-and-flip opportunity only to realize you cannot close because your LLC formation is still processing.

Credit History Considerations

A question I hear constantly is whether credit score matters for hard money loans. The answer is yes and no. Unlike banks that reject applications based purely on credit scores below certain thresholds, hard money lenders take a more nuanced approach. I look at credit history as one factor among many. The property and the deal carry more weight than a number on a report.

That said, most Long Island hard money lenders want to see credit scores above 660. Some will work with scores down to 600 if other factors are strong. What I am really looking for is a pattern of paying bills on time. Recent late payments, collections, or charge-offs raise red flags. Not because they automatically disqualify you, but because they suggest current financial instability that could affect your ability to make monthly interest payments.

If you have derogatory items on your credit report, be upfront about them. Explain the circumstances. If a business downturn three years ago caused some late payments but you have been current ever since, that story matters. Trying to hide credit issues or minimize them backfires badly when they surface during underwriting. I would rather hear about problems directly from the borrower than discover them in a credit pull.

Deal Documentation Package

Now we get to the meat of the application. The deal documentation package separates prepared investors from people winging it. When somebody comes to me with a potential loan, my first questions are simple. What is the purchase price? What is the after-repair value supported by comps? What is the construction cost?

These three numbers drive everything. Without them, no legitimate hard money lender can give you a term sheet. The purchase price comes from your contract. If you are not yet in contract, that is fine for preliminary conversations, but understand that actual loan approval requires an executed purchase agreement with real numbers.

The after-repair value, or ARV, needs support from comparable sales. Comps should come from a licensed real estate agent familiar with the Long Island market, or from your own analysis if you have the expertise. Nassau County median home prices hit $837,000 in October 2025. Suffolk County medians reached $701,000 in the same period. These numbers matter because they establish what the market will bear for your finished product.

Construction cost documentation requires a scope of work from a licensed contractor. Not a ballpark estimate you came up with by watching YouTube videos. A written proposal that breaks down every line item. Demolition costs. Material costs. Labor costs. Permit fees. Dumpster rentals. Everything. Lenders use this scope of work to structure draw schedules and validate that your budget is realistic.

If you want to learn more about how Equiquest approaches deal review and underwriting, visit our Long Island hard money lender page for details on our process.

The Financial Analysis

Beyond the basic numbers, I want to see your financial analysis. Most experienced fix-and-flip investors have an Excel spreadsheet or some analysis tool they use on every deal. This analysis should show gross profit, net profit, and account for all the costs that newer investors miss. Holding costs are the big one. Interest payments on your loan. Property taxes during the hold period. Insurance. Utilities. These add up FAST and can turn a profitable flip into a break-even deal or worse.

Your analysis should also include a realistic timeline. How long do you expect the renovation to take? How long to list and sell the property? What is your exit strategy if the market softens? Hard money loans typically run 6 to 36 months, with 12 months being most common for fix-and-flip projects. Your timeline needs to fit within those parameters with room for unexpected delays.

Team Readiness Assessment

Real estate investing is a team sport. When I evaluate a loan application, I am not just looking at the deal and the borrower. I am looking at the entire team. Do you have a contractor lined up? Is that contractor experienced with fix-and-flip renovations specifically, or do they primarily do new construction or homeowner remodels? These are different skill sets.

Do you have a real estate attorney who understands investment transactions? A title company that can move quickly? An insurance agent who can bind coverage on short notice? A real estate agent ready to list the property when renovation completes? Each of these team members plays a critical role, and missing any one of them can derail your project timeline.

For newer investors, I function as something of a co-pilot on deals. Part of my newer investor loan product involves evaluating team readiness and providing guidance on finding the right professionals. If your contractor just fell through, I might know alternatives. If you need a recommendation for a title company that specializes in investor transactions, I can point you in the right direction. This local knowledge is one of the advantages of working with a boutique lender focused exclusively on Long Island.

Financial Analysis Preparation

Here is the thing about hard money lending that trips people up. The interest rate matters far less than you think. People call me constantly asking about rates before they tell me anything about their deal. They are asking the wrong question.

What you should be calculating is total cost of loan. This includes the interest rate, yes. But it also includes origination points, typically 1 to 3 points on Long Island with 2 being common. It includes any application fees, underwriting fees, processing fees, appraisal costs, and closing costs. A $400,000 loan at 12% interest with 2 points means $8,000 in points alone, plus approximately $4,000 in monthly interest payments.

According to research from OneMain Financial, many borrowers fail to account for the full cost structure when comparing hard money options. Points, fees, and term length all factor into your true borrowing cost. A lower interest rate from a lender charging more points and longer minimum terms often costs more than a slightly higher rate with better terms.

Your financial analysis should account for every dollar leaving your pocket. Compare loan products apples to apples. And factor in the speed advantage. A hard money lender who can close in two weeks when you need to close in two weeks delivers value that the bank offering better rates in 45 days simply cannot match.

Cash Reserves and Down Payment

Hard money loans require equity from the borrower. This is non-negotiable. The typical loan-to-value ratio on Long Island ranges from 40% to 65% for standard investment properties.

For acquisition-only loans, expect down payments of 25% to 40%. For fix-and-flip transactions with renovation funding, the structure differs. You might put down 10% to 20% of the purchase price while the lender funds up to 100% of documented renovation costs through a draw schedule. The specific structure depends on your experience level, the property, and the strength of your deal.

Beyond the down payment, lenders want to see cash reserves. Most require three to six months of loan payments sitting in liquid bank accounts. If your monthly interest payment is $4,000, you need $12,000 to $24,000 in accessible cash beyond your down payment and renovation float. This reserve protects you and the lender if the project timeline extends or market conditions shift.

Bring recent bank statements to your loan application meeting. Three months of statements showing consistent balances and normal transaction patterns. Lenders review these statements to verify you have the financial capacity to handle the project even if things do not go exactly as planned.

Property and Market Requirements

Not every property qualifies for hard money financing. The most important restriction involves occupancy. Hard money loans are for investment properties only. You must sign an affidavit of non-occupancy confirming you will not live in the property during the loan term. Owner-occupied loans trigger different federal regulations that fundamentaly change the loan structure and timeline.

Property types that typically qualify include single-family homes, duplexes, triplexes, and four-unit buildings. Some lenders also finance small commercial properties, mixed-use buildings, and larger multifamily. The property must be located within the lender's geographic focus area. For Equiquest, that means Nassau and Suffolk counties, from the Queens border out to Montauk Point.

Property condition matters differently for hard money than conventional lending. Banks shy away from distressed properties needing major work. Hard money lenders often prefer them because the value-add potential creates opportunity. A house that fails conventional financing standards due to code violations or structural issues might be exactly the kind of deal hard money was designed for.

Timeline and Closing Expectations

Speed is one of the primary reasons investors choose hard money over traditional financing. A typical hard money closing on Long Island takes two to three weeks when documentation is complete. Some deals close in five to seven business days under optimal conditions.

The timeline starts when you submit a complete application with all required documentation. The lender then orders title work, which typically takes five to seven business days. The appraisal process runs concurrently, taking three to four days for scheduling plus five to seven days for the report. Underwriting happens in parallel, and once all pieces are assembled, final approval and funding follow within 48 hours.

What slows things down? Missing documentation. Title issues like existing liens or judgments that need clearing. Appraisals that come in lower than expected, requiring renegotiation or additional equity. The more prepared you are upfront, the faster your deal closes.

The Pre-Approval Advantage

Here is something I recommend to any serious Long Island investor. Build the relationship before you need the money. Schedule a call with me. Have a conversation about your investment strategy. Get pre-approved for financing so that when the right deal comes along, we can move at LIGHTNING speed.

Pre-approval does not cost you anything. It involves gathering your documentation, running preliminary underwriting, and establishing that you qualify for financing up to a certain amount. Then when you find a property, you already have a lender who knows you, knows your team, and can issue a term sheet the same day you send over the deal.

Sellers and their agents notice when a buyer comes with proof of funds from a lender they trust. In competitive situations, that pre-approval letter can make the difference between winning a deal and watching it go to someone else.

What Happens After You Apply

Once your application is submitted with complete documentation, several things happen simultaneously. I review the deal fundamentals. Does the purchase price make sense for the market? Do the ARV projections hold up against recent comparable sales? Is the construction budget realistic for the scope of work proposed?

I drive by the property. Living on Long Island for over 50 years gives me tremendous knowledge of every neighborhood from Valley Stream to Montauk. That drive-by often confirms what the paperwork suggests, but sometimes it reveals factors that do not show up in photos or spreadsheets. A property next to a busy commercial strip. A neighborhood in transition. These observations inform the lending decision.

The underwriting team pulls credit, runs background checks, and verifies bank statements. Title work confirms the property can transfer clean. The appraiser visits and prepares a report supporting the current value and, for fix-and-flip loans, the after-repair value. All of this converges into a final loan package that goes to closing.

Avoiding Common Mistakes

After five years of funding deals on Long Island, I have seen patterns in what causes loan applications to fail or stall. Avoid these mistakes and your process will run smoothly.

First, do not show up without your homework done. If I ask about ARV and you say you think it is probably around a certain number, that tells me you have not done the research. Come with comps. Come with contractor bids. Come with a financial analysis that accounts for realistic costs and timelines.

Second, do not try to hide information. If there are credit issues, disclose them. If the property has problems, tell me. If your contractor has never done a fix-and-flip before, let me know. I would rather work through challenges upfront than discover them during underwriting when they become deal-killers.

Third, do not wait until you have a deal under contract to start the lending conversation. Build the relationship first. Get pre-approved. Have your documentation organized and ready to go. The investors who consistently win deals on Long Island are the ones who can move fast because they prepared in advance.

Ready to Get Started?

If you have a deal in Nassau or Suffolk County that needs fast funding, or if you want to get pre-approved before you start looking, I am ready to talk. Schedule a meeting through the Equiquest application page and bring your documentation. Purchase price, ARV, construction budget, contractor info, entity documents. The more prepared you are, the faster we can get you to funding.

Hard money lending works when both sides come prepared. I bring local expertise, fast decisions, and flexible terms tailored to Long Island real estate. You bring a solid deal, complete documentation, and the capacity to execute. Together, we close deals that banks would take months to even consider.