Hard Money Loans in Milwaukee, Wisconsin
There are 42 lenders operating in Milwaukee, WI. Note amounts average approximately $270,000. Rates on hard money loans made to Milwaukee investors average around 13.5%. The median term offered for loans is 23 months. The average origination fee for the loans is 6.4 points. Lenders offer on average a 70% loan-to-value on loans in Milwaukee.
Loan Example 1
Jessica takes a loan from East Side Finance Corporation in order to remodel a townhome to flip in the Garden Homes neighborhood of Milwaukee, WI. The sales price of the house is $180,000. Because the lender sets a 85% loan-to-value, Jessica will be required to put 15% down so the amount of the loan will be $153,000. The terms of the deal dictate a 11% note for 18 months. They also stipulate a 5 point origination fee, which will also be paid when the property closes.
The borrower must contribute a total of $32,400 up front to cover the $27,000 down payment plus the $7,650 origination fee. The monthly interest only payments will then total $1,403 to the lender. If Jessica sells the project for $225,000 after 18 months, she would then make a gross profit of $12,105 after deducting the principle amount of $153,000, the funds paid at closing of $27,000, the origination points of $7,650, and the aggregate interest payments of $25,245. This gross profit doesn't include rehab costs.
Loan Example 2
Dianna takes a hard money loan from Affluent Lending in order to rehab a property to re-sell in the Cold Sprint Park neighborhood of Milwaukee, WI. The deal has the following parameters:
$310,000 sales price
55% loan to value (LTV)
6 month term
11% rate of interest
5% origination fee
Once the renovation project is complete, if Dianna sells the property for $418,500, the numbers would be as follows:
$418,500 sales price
- $170,500 principle on note (55% LTV)
- $139,500 down payment (45% on 55% LTV)
- $8,525 origination fee (5% of the $170,500 principle)
- $9,378 interest payments (6 months x 11% interest)
= $90,598 total profit (doesn't include taxes or renovation costs)