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Estimate your loan
Example inputs; replace them with the terms on your lender's quote. Nothing you type is sent anywhere. Not a loan offer.
How lenders size a hard money loan
Hard money lenders commonly cap the loan two ways and lend the smaller amount: a share of what you pay for the property and the rehab (loan-to-cost), and a share of what the property will be worth after the work (loan-to-ARV). The calculator applies both and tells you which one set the number.
| Step | Example | Amount |
|---|---|---|
| Loan-to-cost on the purchase | 90% of $200,000 | $180,000 |
| Rehab financed | 100% of $50,000 | $50,000 |
| Cost cap | Purchase part + rehab part | $230,000 |
| ARV cap | 70% of $330,000 | $231,000 |
| Loan | The smaller of the two | $230,000 |
What the loan costs
Hard money loans are usually interest-only, so the monthly payment is the loan times the rate divided by 12. On the example, $230,000 at 11% is $2,108 a month. Over six months that is $12,650 of interest, plus 2 points ($4,600) and $1,500 of other fees: $18,750 in total.
Whether interest runs on the full loan or only on rehab money already drawn matters. Lenders differ, so check your term sheet. On the example, interest on drawn funds only (assuming the rehab is drawn evenly) is $11,275 instead of $12,650.
Cash you need
At closing you bring the part of the purchase price the loan does not cover, the points and the lender fees: $26,100 in the example. On top of that, plan for title, insurance and closing costs, monthly interest, and any rehab the lender does not fund. Rehab money is often released in draws as work is completed, so you may need to front the first stage; check your lender's draw terms.
Compare real terms on the hard money loan rates page, check what lenders require, or run the whole deal through the fix and flip calculator.
Thinking of 100% financing? See what no money down really covers.
Frequently asked questions
How do you calculate a hard money loan payment?
Most hard money loans are interest-only: multiply the loan amount by the annual interest rate and divide by 12. A $230,000 loan at 11% is about $2,108 a month.
How much will a hard money lender lend?
Usually the smaller of a percentage of the purchase price plus rehab (loan-to-cost) and a percentage of the after-repair value (loan-to-ARV). The exact percentages vary by lender and by your experience.
What are points on a hard money loan?
An upfront fee expressed as a percentage of the loan. Two points on a $230,000 loan is $4,600, usually paid at closing.
Do you pay interest on the full hard money loan or only what is drawn?
It depends on the lender. Some charge interest on the full loan from day one; others charge only on rehab funds already released. The calculator shows both.