Posted by Scott(CA) on October 04, 2005 at 16:42:36:
I’d love to lend you money at that rate! In your example, it should be 12% PER YEAR, not per month.
Try .12/12*50000 = $500 per month (interest only)
Some HML’s will also charge points and may have a prepayment penalty. 1 point would be equal to one percent of the entire loan amount. Assuming you had to pay points, you would be paying an additional $500 per point (for your example).
question about private money lenders - Posted by Stephanie
Posted by Stephanie on October 04, 2005 at 16:25:27:
If I were to use a private money lender, what is a good formula to figure out the interest they would get back. Lets use and example of borrowing 50,000 at %12 for 3 months to do a rehab.
so is that
$50,000
x %12
$6,000 a month?
then multiply that by 3 (for 3 Months)
So would that private money investor get back $18,000 plus the origional $50,000 for a total of $68,000?