True cost of a hard money loan

Models the accrual basis, minimum interest, the full fee stack, draw fees and extensions - then shows the real annualised cost.

The deal

Everything below is prefilled with a realistic deal so you can see how the machine behaves. Change one number at a time and watch which ones actually move the answer.

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$

$Be conservative. This is the number that is wrong most often.

Not the term. The honest estimate, including the month it sits on market.

What the lender is lending

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%

Interest

%

Ask this question out loud. It is the single largest hidden cost difference between two lenders quoting the same rate, and it is almost never volunteered.

Interest you owe even if you pay the loan off sooner. Enter 0 if there is none.

Points and fees

%

Charging points on money you have not received yet is standard. It is also why your effective point count is higher than the number on the term sheet.

$Typically $500-$1,500 each, and there are usually two or three of them.

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$

%Charged at payoff. Many lenders have none; some have 1-2%.

If you run late

Projects run late. This section is the one people skip and then pay for.

%Percent of the loan, per extension period.

Everything that is not the loan

%Title, escrow, recording, transfer on the way in.

$Taxes, insurance, utilities, lawn, alarm.

%Agent commission, transfer tax, concessions on the way out.

True cost of a hard money loan by Hard Money Facts — independent research on hard money and private real estate lending. Free to embed. Nothing you type here is transmitted anywhere.