Fix and Flip Loans in ,
Lafayette, IN has 46 fix and flip lenders serving the city. In this city, the average note amount is $302,813. The average rate for loans in Lafayette is 10.9%. The median term offered for notes is 49 months. The average origination percentage added to loans is 4.2%. The average loan-to-value (LTV) offered for loans in Lafayette is 76%.
Loan Example 1
Raul finds a condo in Lafayette, IN to remodel and re-sell. Since he doesn't have enough cash on-hand to purchase the $170,000 project outright, he decides to take out a fix and flip loan from Trust Funding Corporation . As the lender agrees to a 80% loan to value, Raul will have to put 20% down and the principle amount of the note will be $136,000. The terms of the note also stipulate a two percent origination fee which is to be paid at closing and a 18 month, interest-only note with a 11% rate of interest.
Accordingly, Raul will need to contribute a $34,000 down payment in addition to paying a $2,720 origination fee. The monthly interest-only payments will then be $1,247 to the lender. If Raul meets his goal of a $212,500 sales price at the end of the loan term, he would pocket a total profit of $17,340 after re-paying the principle on the note and deducting the money he brought to closing, the origination points, and the total interest payments.
Loan Example 2
Redwood Investment Group makes a loan to Paige for a rehab project in Lafayette, IN. The loan includes the following:
a) A $170,000 sales price, b) a 55% loan-to-value (LTV), c) a 18 month term, d) a 12% interest rate, and e) a 2% origination fee.
Once the rehab project is completed, if Paige sells the project for $246,500, the outcome would be the following:
$246,500 sales price
- $93,500 principle (55% LTV)
- $76,500 cash paid at closing (45% on 55% LTV)
- $1,870 origination points (2% of the $93,500 principle amount)
- $16,830 total interest paid (18 months x 12% interest)
= $57,800 gross profit (does not include taxes or renovation costs)