Financing

How hard money lenders look at properties with unpermitted decks

Hard money lenders assess risk in every property, and an unpermitted deck often raises red flags. They will focus on safety, structural integrity, and the cost of remediation or removal.

October 17, 2026 · 3 min read

Why an unpermitted deck is a concern

An unpermitted deck is a liability for both you and your hard money lender. Lenders are concerned about safety issues, potential code violations, and the legality of the structure. If the deck is not up to code or collapses, it creates a significant risk.

Furthermore, the lack of permits means no official inspections were performed during construction. This uncertainty makes it difficult for a lender to accurately assess the property's true value and the cost to bring it up to standard. It represents an unknown variable in the property's condition.

Assessing the deck's condition and code compliance

Before approaching a lender, you need to thoroughly inspect the deck yourself or hire a professional. Look for signs of rot, loose railings, unstable footings, or inadequate support. Compare its construction to local building codes for decks, even if it is unpermitted.

Document everything with photos and notes. Your goal is to understand the extent of the issue. Is it a minor oversight, or a significant structural hazard? This assessment will inform your plan for the lender.

Estimating remediation or removal costs

Lenders will want to know your plan and the associated costs. Get quotes from contractors for either bringing the deck up to code (including obtaining retrospective permits, if possible in your jurisdiction) or for its complete removal and disposal. Factor these costs into your rehab budget.

Be transparent about these expenses in your loan application. This demonstrates you have identified the problem and have a clear, actionable solution. A lender wants to see that you have accounted for potential issues.

Presenting your plan to the lender

When discussing the unpermitted deck with your hard money lender, do not hide the issue. Instead, present it as a problem you have already identified and have a clear plan to resolve. Outline your assessment, the estimated costs, and your strategy (e.g., permit and repair, or demolish and rebuild/remove).

Show that you have done your due diligence. For example, you might explain, "The deck is unpermitted, but it appears structurally sound. Our plan is to secure the necessary permits and reinforce the railing, budgeted at a hypothetical $3,000." This proactive approach builds confidence.

Disclaiming the nature of this advice

Please note: This information is for educational purposes only and is not financial, legal, or investment advice. Always consult with a qualified professional, such as a contractor, attorney, or financial advisor, before making any decisions related to unpermitted structures or property financing. Specific requirements and regulations vary by location and lender.

Questions people ask

Will a lender always require the deck to be permitted or removed?

It depends on the lender and the severity of the issue. Many will require it to be either permitted to code or removed as part of the rehab. Some might overlook a minor, non-structural issue if your overall deal is strong, but this is less common for hard money.

Can I use the deck's value in the ARV calculation?

If the deck is unpermitted, it generally cannot be reliably factored into the After Repair Value (ARV) until it is brought up to code. It may even detract from the value if it's a hazard. Plan to address it before counting on its contribution to value.

What if the deck was built a long time ago?

The age of the deck does not negate the permitting issue. While some jurisdictions have different rules for older structures, the lack of permits still means it was never officially approved. Lenders will still treat it as a potential liability requiring remediation.