Hard money lending in Florida

This page covers four things about borrowing hard money in Florida: whether the lender needs a licence, what actually decides whether your rate is lawful, how federal preemption interacts with it, and how long deals take here. Every figure shows the statute or dataset it came from.

Does a lender need a licence in Florida?

Requirements differ depending on whether the borrower is an individual or an entity and how the property is classified.

Florida does not resolve to a single answer. The requirement turns on whether the borrower is an individual or an entity, and on how the property is classified.

That makes Florida one of the states where the structure of your own transaction changes the answer - so a general rule from a forum post is worth very little here. Ask the Office of Financial Regulation about your specific structure.

What decides whether a rate is legal in Florida

Almost every site publishing on this topic gives you one number per state. That number is close to meaningless on its own. A rate that is lawful for one lender in Florida can be unlawful for another on the same day, on the same property, because four separate questions decide which body of law applies to your loan.

Purpose

Many states remove the usury defence entirely for business-purpose loans. Washington is the clean example: under RCW 19.52.080 a borrower on a loan made primarily for a commercial, agricultural, investment or business purpose may not claim a defence of usury. This is why every hard money lender makes you sign a business-purpose affidavit.

Borrower

Several states exempt entity borrowers from some or all of the cap. In New York a corporation or LLC cannot assert the 16% civil usury defence at all, though the 25% criminal ceiling still applies. This is the other half of why lenders insist on title vesting in an LLC.

Lender

Licensed lenders frequently operate under their own rate statute rather than the general cap. California is the sharpest case: a loan made or arranged by a licensed real estate broker and secured by real property is exempt from the constitutional rate limit outright, under Civil Code §1916.1.

Lien position

If it is, federal law may preempt the state rate limit entirely under 12 U.S.C. §1735f-7a. A great many hard money loans are first-lien residential, so this gate is live far more often than borrowers realise.

Rate limits in Florida

The ceiling steps at $500,000, and criminal usury is a real prosecution risk.

Florida caps interest at 18% on loans below $500,000 under §687.03. Above $500,000 the ceiling rises to 25%.

Above that, Florida is unusual in how hard the criminal side bites. Rates of 25% or more but under 45% are a criminal offence, and rates above 45% are a third-degree felony under §687.071.

The civil consequences are also severe rather than nominal. A usurious loan forfeits all interest charged. A criminally usurious loan makes the entire debt unenforceable, principal included.

Federal preemption, and the distinction nearly everyone gets wrong

Two different provisions of the Depository Institutions Deregulation and Monetary Control Act of 1980 are routinely written about as if they were one. They are not, and only one of them normally touches a hard money loan.

Section 501 — 12 U.S.C. §1735f-7a

Preempts state limits on the rate, discount points, finance charges and other charges on a loan secured by a first lien on residential real property, made after 31 March 1980, that meets the federally related mortgage loan definition. This one can apply to hard money, because a great many hard money loans are exactly that. States had until 1 April 1983 to opt out.

Section 521 — 12 U.S.C. §1831d

Lets federally insured state-chartered banks charge the rate allowed where the bank is located, and export it. Hard money lenders are generally not banks, so this provision usually has nothing to do with your loan, despite how often it is cited in articles about private lending.

Who supervises this in Florida

Florida Office of Financial Regulation. Regulator names change; the CSBS directory is the authoritative list, and NMLS Consumer Access is where you check a specific company for free.

Regulators answer licensing questions at no charge, and a narrow question gets a useful answer where a broad one does not. Send this:

For a business-purpose loan secured by investment property in Florida, where the borrower is an LLC, does the lender require a licence?

Ask the Florida Office of Financial Regulation

How long deals actually take in Florida

Hard money is priced by the month, so the exit timeline is the cost driver. Median days on market below is measured from Redfin's county-level sales data for single-family homes (May 2026). The term column adds a five-month renovation and 45 days for your buyer to close, which is the part borrowers routinely leave out of the term they request.

Before you sign in Florida

1. Confirm the licence, or confirm on the record that none is required for this loan type. How to verify a lender.
2. Establish which of the four gates your loan goes through, because that decides which rate limit applies.
3. Score your term sheet against the 14 red flags.
4. Price the loan on total cost, not rate. True-cost calculator.