Hard Money Loans in ,
Hopkinsville, KY has 41 lenders serving the city. Note amounts average about $298,438. Rates for loans average around 10.1%. The typical term offered for notes is 15 months. A typical loan made in this city includes a 2.9 percent origination cost. The average loan-to-value (LTV) offered for loans in Hopkinsville is 76%.
Loan Example 1
Vickie is an investor in Hopkinsville, KY. She finds a run-down property and decides to remodel it and resell it for a profit. The house costs $240,000 but she doesn't have the full amount so she obtains a hard money loan with Assurance Investment Company . The terms of the deal include a 70% loan-to-value (LTV), so she must contribute 30% of the price as cash to closing, which makes the principle note amount $168,000. The interest rate on the loan is 10% for a length of 18 months and the company requires a two point origination fee at the closing. The interest payments are to be paid on a monthly basis and the principle amount will be paid back after the sale of the property.
Vickie will need to contribute $72,000 at the closing (30% on the 70% loan-to-value), plus she will need to pay the $3,360 origination fee. Once the deal is closed and Vickie takes over the project, she will need to begin making payments each month of $1,400 to Assurance Investment Company ($168,000 principle x 10% / 12 months). Assuming Vickie sells the renovated house for $324,000 at the end of the 18 month term, her total profit (not including renovation costs) would be $55,440. This is computed by taking the sales price ($324,000) and subtracting the principle ($168,000), the origination cost ($3,360), the cash she contributed to closing ($72,000), and the total interest payments ($25,200).
Loan Example 2
William takes out a private money loan from North End Funding Group in order to rehab a townhouse to flip in Hopkinsville, KY. The deal has the following terms:
a) A $220,000 purchase price, b) a 85% loan-to-value (LTV), c) a 12 month term, d) a 14% interest rate, and e) a 1% origination fee.
Assuming a $319,000 sales price after the 12 month term, the numbers for this deal would look like the following:
$319,000 sales price
- $187,000 principle (85% LTV)
- $33,000 down payment (15% on 85% LTV)
- $1,870 origination fee (1% of the $187,000 principle)
- $26,180 total interest paid (12 months x 14% interest)
= $70,950 gross profit (doesn't include taxes or renovation costs)