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Nation’s fastest and easiest private real estate lender - Funding Fix and Flip, Ground-Up Construction, and DSCR. Closing as fast as 5 business days!
Picacho, AZ has 50 private money lenders operating in the city. The mean loan issued to borrowers is approximately $369,286. Rates for private loans average around 10.8%. The average loan issued in the city has a term of 18 months. The average points charged on the loans is 2.7%. Lenders in Picacho average a 74% loan to value on their loans.
Goldie finds a property in Picacho, AZ to renovate and resell. Since she does not have enough cash on-hand to acquire the $400,000 property outright, she decides to take out a bridge loan from Blue Mountain Investment Company. Because the lender agrees to a 55% loan-to-value, Goldie will be required to put 45% down and the total amount of the loan will be $220,000. The interest rate on the loan is 11% for a length of 18 months and the lender requires a three point origination fee at closing. The interest is to be paid monthly and the principle amount will be paid back after the property sells.
Accordingly, Goldie will need to make a $180,000 down payment in addition to paying a $6,600 origination fee. The lender will collect $2,017 in monthly interest from the Goldie. This is calculated by taking the total loan amount of $220,000, multiplying by the 11% interest rate, and then dividing that amount by 12. If Goldie accomplishes her goal of a $600,000 total sales price when the loan term expires, she would collect a total profit of $157,100 after re-paying the principle on the note and subtracting the cash she contributed at closing, the origination fee, and the total interest payments.
GJ Funding issues a bridge loan to Tyler for a remodeling project in Picacho, AZ. The deal dictates the following:
$290,000 purchase price
85% loan to value (LTV)
6 month term
8% interest rate
2% origination fee
Assuming a $435,000 sales price after the 6 month term, the numbers for this deal would look like this:
$435,000 sales price
- $246,500 note principle (85% LTV)
- $43,500 cash paid at closing (15% on 85% LTV)
- $4,930 origination points (2% of the $246,500 principle)
- $9,860 total interest paid (6 months x 8% interest)
-----------------------
= $130,210 total profit (does not include taxes or rehab costs)
Nation’s fastest and easiest private real estate lender - Funding Fix and Flip, Ground-Up Construction, and DSCR. Closing as fast as 5 business days!
Offering Fix and Flip, Bridge, and DSCR loans. With same day approvals, 3-5 day close time, and lending in 47 states, Park Place Finance will get your next deal funded fast!
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