In California’s fast-paced investment market, brokers are only as good as their borrower pipeline. Sending underprepared investors to private lenders wastes time, hurts credibility, and risks losing repeat business.
Smart brokers don’t just “hand off” deals—they prequalify investors so every file looks fundable from day one. The goal: make private lenders want to prioritize your submissions because they trust your screening.
Lenders like Lending Bee, which works directly with brokers statewide, often close in five to seven business days when the broker has done strong prequalification work.
Here’s how to build that process.
Step 1: Understand the Private Lender’s Focus
Unlike conventional lenders, hard money providers base approvals on the collateral, equity, and exit strategy, not just credit or income.
As a broker, you should be clear on your lender’s priorities before you screen investors. Typical underwriting questions include:
- What’s the property type (SFR, multifamily, mixed-use, land)?
- What’s the current value vs. purchase price?
- What’s the after-repair value (ARV)?
- How much skin in the game does the borrower have (down payment or equity)?
- What’s their exit strategy (sale, refinance, rental)?
When you know this framework, you can vet investors the same way the lender will—saving days in the approval cycle.
Step 2: Collect a Broker Prequalification Package
Create a one-page summary template for every investor or deal you submit. This should include:
| Category | Information Needed |
|---|---|
| Borrower Info | Entity (LLC or individual), experience level, contact info |
| Property Details | Address, type, value, rehab scope, ARV, exit plan |
| Loan Request | Amount, term, estimated LTV/LTC, desired close date |
| Financials | Proof of funds (bank statement or investor capital partner) |
| Timeline | Purchase contract date, contingency period, target closing |
Attach supporting documents (purchase agreement, rehab budget, rent roll if applicable).
Pro tip: Preload everything into a single PDF or shared folder labeled “Broker Prequal – [Investor Name]” before sending. Lenders appreciate clean submissions—it signals professionalism and gets you faster yes/no decisions.
Step 3: Verify Proof of Funds Early
Private lenders prioritize borrowers who can close. The fastest way to show that is through a proof of funds (POF) document.
Ask your investor for:
- Bank statement, escrow deposit, or capital-partner letter
- If using partner capital, a simple joint venture agreement or commitment email
In California, sellers expect this documentation even before offer acceptance, so prequalifying with POF protects both your investor and your reputation.
Step 4: Confirm Investor Experience and Track Record
Lenders like to know:
- Has this investor flipped or built before?
- Are they using licensed contractors?
- Do they have realistic cost and ARV estimates?
If it’s a first-time borrower, you can still position them effectively by providing:
- A detailed rehab plan
- A contractor bid with timelines
- Your own summary confirming you’ve reviewed the comps
By doing this legwork, you establish yourself as the broker who vets before submitting—not one who forwards deals blindly.
Step 5: Pre-Review the Exit Strategy
This is where most deals fail—not because of property risk, but because the borrower doesn’t have a clear exit.
When screening your investor, ask:
- What’s your target timeline to sell or refinance?
- If refinancing, do you already have a takeout lender or DSCR prequal?
- What’s your backup plan if the market slows?
Lenders like Lending Bee structure loans around realistic exits. If your investor has one, you’ll both get faster approval and better terms.
Step 6: Match Loan Terms to the Deal Type
As a broker, you’re the bridge between borrower goals and lender requirements. Match the loan to the project:
| Deal Type | Typical Private Lending Fit |
|---|---|
| Fix & Flip | 6–12 month interest-only term, draws for rehab |
| Bridge to DSCR | 9–18 month loan, interest-only, refinance-ready |
| New Construction | LTC-based draw funding, aligned with permit stages |
| Cash-Out Refinance | Short-term bridge to reposition or reinvest |
If you send mismatched scenarios—like a flip borrower requesting 24 months—you risk slowdowns or declines.
Step 7: Prepare for Lender Communication
When you hand off your investor to the lender, stay involved until closing.
Provide quick responses, clarify inspection or title needs, and maintain transparency.
What lenders love to see:
- Organized broker packages
- Complete property photos and budgets
- Fast borrower responsiveness
The more polished your prequalification process, the faster the lender can issue a term sheet—often same-day in California markets.
Why Lenders Prioritize Brokers Who Prequalify
Private lenders handle dozens of submissions weekly. When a broker consistently sends organized, ready-to-fund deals, that relationship moves to the front of the line.
Lending Bee, for example, tracks broker performance internally and gives priority processing to partners with high funding ratios—because it means less underwriting friction.
That means more of your deals close, faster—creating a cycle of trust and repeat business.
Common Red Flags to Catch Before Submission
✔ Inflated ARVs without comps
✔ No defined exit plan
✔ Weak proof of funds
✔ Missing rehab scope or contractor estimates
✔ Borrowers unable to verify property ownership or purchase contract
Catching these before submission protects your lender relationships—and your reputation as a professional broker.
Final Thoughts
Prequalifying investors for hard money isn’t about gatekeeping—it’s about protecting time, trust, and deal velocity.
When you screen your borrowers like a lender would, your approval rates soar, your closings accelerate, and your private lending partners—like Lending Bee—start seeing you as an extension of their own underwriting team.
That’s how California’s top-producing brokers build long-term pipelines: they don’t just find deals—they send ready-to-fund investors.