{"id":1038,"date":"2020-02-15T14:10:11","date_gmt":"2020-02-15T14:10:11","guid":{"rendered":"https:\/\/blog.calhardmoney.com\/?p=1038"},"modified":"2023-06-29T11:48:39","modified_gmt":"2023-06-29T11:48:39","slug":"calculating-the-actual-cost-of-a-hard-money-loan","status":"publish","type":"post","link":"https:\/\/www.calhardmoney.com\/blog\/calculating-the-actual-cost-of-a-hard-money-loan\/","title":{"rendered":"Calculating the Actual Cost of a Hard Money Loan"},"content":{"rendered":"\r\n<p>If you are interested in securing a hard money loan,\r\nit is important to go into the process with your eyes open and a proper understanding of the actual cost associated with this type of\r\nloan.<\/p>\r\n\r\n\r\n\r\n<p>A hard money loan is generally one of the quickest and most efficient mechanisms you can utilize to finance a fix-and-flip in or around Los Angeles. In addition, a <a href=\"https:\/\/www.calhardmoney.com\/\"><strong>hard money loan<\/strong><\/a>&nbsp;is typically approved or denied primarily on the basis of the property\u2019s value, as opposed to the personal portfolio or credit score of the borrower. Though, it is true that hard money loans generally tend to be more expensive when compared to traditional financing through a bank or other financial institution. Hence, &nbsp;it is important to understand the potential loan amount, the upfront costs involved, ongoing interest charges and total costs of servicing the loan for a term of weeks, months, etc.<\/p>\r\n\r\n\r\n\r\n<h2 class=\"wp-block-heading\">Calculating the Cost<\/h2>\r\n\r\n\r\n\r\n<p>There are specific costs you should understand when pursuing\r\na hard money loan, including: the amount needed to purchase the property, the \u201cafter\r\nrepaired\u201d value of the property, the costs necessary to repair the property,\r\nthe lender\u2019s expected loan-to-value ratio, the interest rate, the term of the\r\nhard money loan, and any upfront points and fees.<\/p>\r\n\r\n\r\n\r\n<h2 class=\"wp-block-heading\"><strong>Purchase Price<\/strong><\/h2>\r\n\r\n\r\n\r\n<p>It is extremely important to figure out the purchase\r\nprice for actually buy the property. If you do not have an actual purchase\r\nprice, do the necessary research to determine the anticipated or expected\r\npurchase price. Once the purchase price is calculated, do the legwork to then\r\nfigure out the \u201cafter repaired\u201d value of the property to ensure it makes\r\neconomic sense to pursue a hard money loan for the project.<\/p>\r\n\r\n\r\n\r\n<h2 class=\"wp-block-heading\">Term of Loan<\/h2>\r\n\r\n\r\n\r\n<p>Typically, a hard money loan is shorter in length\r\n(routinely a month or two). However, there are instances when the term of a\r\nhard money loan could be six months, ten months, or even more than a year. The\r\nterm of the loan will greatly impact the overall cost of securing the loan.<\/p>\r\n\r\n\r\n\r\n<h2 class=\"wp-block-heading\">Interest Rate &nbsp;<\/h2>\r\n\r\n\r\n\r\n<p>It is important to understand that <strong><a href=\"https:\/\/www.calhardmoney.com\/los-angeles-hard-money-lenders.php\">hard money lenders in Los Angeles<\/a><\/strong>&nbsp;do not charge prevailing mortgage rates and the interest rates are generally higher to secure a hard money loan (since they are shorter in length, are riskier, etc.). Once the interest rate is determined, you can use it to calculate the overall cost of the loan.&nbsp; <\/p>\r\n\r\n\r\n\r\n<h2 class=\"wp-block-heading\">Points and Loan Origination<a><strong> <\/strong><\/a>Fe<strong>e<\/strong>s<\/h2>\r\n\r\n\r\n\r\n<p>Points are a form of prepaid interest. Each point typically\r\nrepresents 1 percent of the loan amount. Obviously, the more points, the higher\r\nthe overall cost of the loan.<\/p>\r\n\r\n\r\n\r\n<h2 class=\"wp-block-heading\">Looking for <em>Hard Money Loans in Los Angeles<\/em>? Take Action and Contact PB Financial Group Today<\/h2>\r\n\r\n\r\n\r\n<p>If you have your eye on a valuable piece of property or home that can be flipped for profit, do not let a lack of funds hold you back. Consider contacting a highly reputable <a><strong>hard money lender in Los Angeles<\/strong><\/a><a href=\"#_msocom_9\">[l9]<\/a>&nbsp;<strong> <\/strong>such as PB Financial Group. The professional hard money experts at PB Financial have helped over 2000 clients thus far and can do the same for you. For further information or to schedule a consultation please contact PB Financial Group at <strong><a href=\"tel:8777003703\">877.700.3703<\/a><\/strong>&nbsp;or visit <a href=\"https:\/\/www.CalHardMoney.com\">www.CalHardMoney.com<\/a> to learn more.<\/p>\r\n\r\n\r\n\r\n<p><strong>PB Financial NMLS #357614\/DRE #01522495<\/strong><\/p>\r\n","protected":false},"excerpt":{"rendered":"<p>If you are interested in securing a hard money loan, it is important to go into the process with your eyes open and a proper understanding of the actual cost&#8230;<\/p>\n","protected":false},"author":2,"featured_media":1039,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[3,92],"tags":[],"class_list":{"0":"post-1038","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-blog","8":"category-hard-money-lenders-in-los-angeles"},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.3 (Yoast SEO v27.5) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Calculating the Actual Cost of a Hard Money Loan<\/title>\n<meta name=\"description\" content=\"If you are looking to calculate the actual cost of a hard money loan. Call PB Financial Group the best hard money lenders in Los Angeles at 8777003703 for info.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.calhardmoney.com\/blog\/calculating-the-actual-cost-of-a-hard-money-loan\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Calculating the Actual Cost of a Hard Money Loan\" \/>\n<meta property=\"og:description\" content=\"If you are interested in securing a hard money loan, it is important to go into the process with your eyes open and a proper understanding of the actual\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.calhardmoney.com\/blog\/calculating-the-actual-cost-of-a-hard-money-loan\/\" \/>\n<meta property=\"og:site_name\" content=\"PB Financial Group Corporation\" \/>\n<meta property=\"article:published_time\" content=\"2020-02-15T14:10:11+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-06-29T11:48:39+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.calhardmoney.com\/blog\/wp-content\/uploads\/2020\/02\/Hard-money-lenders-in-Los-Angeles-1.png\" \/>\n\t<meta property=\"og:image:width\" content=\"359\" \/>\n\t<meta property=\"og:image:height\" content=\"241\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"author\" content=\"Pouyan Broukhim\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Pouyan Broukhim\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.calhardmoney.com\\\/blog\\\/calculating-the-actual-cost-of-a-hard-money-loan\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.calhardmoney.com\\\/blog\\\/calculating-the-actual-cost-of-a-hard-money-loan\\\/\"},\"author\":{\"name\":\"Pouyan Broukhim\",\"@id\":\"https:\\\/\\\/www.calhardmoney.com\\\/blog\\\/#\\\/schema\\\/person\\\/267a00f001fe4e589f0d08676c1e76d1\"},\"headline\":\"Calculating the Actual Cost of a Hard Money Loan\",\"datePublished\":\"2020-02-15T14:10:11+00:00\",\"dateModified\":\"2023-06-29T11:48:39+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.calhardmoney.com\\\/blog\\\/calculating-the-actual-cost-of-a-hard-money-loan\\\/\"},\"wordCount\":558,\"commentCount\":0,\"image\":{\"@id\":\"https:\\\/\\\/www.calhardmoney.com\\\/blog\\\/calculating-the-actual-cost-of-a-hard-money-loan\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.calhardmoney.com\\\/blog\\\/wp-content\\\/uploads\\\/2020\\\/02\\\/Hard-money-lenders-in-Los-Angeles-1.png\",\"articleSection\":[\"Blog\",\"Hard Money Lenders in Los Angeles\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/www.calhardmoney.com\\\/blog\\\/calculating-the-actual-cost-of-a-hard-money-loan\\\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.calhardmoney.com\\\/blog\\\/calculating-the-actual-cost-of-a-hard-money-loan\\\/\",\"url\":\"https:\\\/\\\/www.calhardmoney.com\\\/blog\\\/calculating-the-actual-cost-of-a-hard-money-loan\\\/\",\"name\":\"Calculating the Actual Cost of a Hard Money Loan\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.calhardmoney.com\\\/blog\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/www.calhardmoney.com\\\/blog\\\/calculating-the-actual-cost-of-a-hard-money-loan\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/www.calhardmoney.com\\\/blog\\\/calculating-the-actual-cost-of-a-hard-money-loan\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.calhardmoney.com\\\/blog\\\/wp-content\\\/uploads\\\/2020\\\/02\\\/Hard-money-lenders-in-Los-Angeles-1.png\",\"datePublished\":\"2020-02-15T14:10:11+00:00\",\"dateModified\":\"2023-06-29T11:48:39+00:00\",\"author\":{\"@id\":\"https:\\\/\\\/www.calhardmoney.com\\\/blog\\\/#\\\/schema\\\/person\\\/267a00f001fe4e589f0d08676c1e76d1\"},\"description\":\"If you are looking to calculate the actual cost of a hard money loan. 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