Hard Money Loan Calculator (Fix & Flip)
Points, interest-only carry, and balloon on a fix-and-flip hard money loan, plus total financing cost, cash needed in, and projected project profit. Free.
Hard Money Loan Calculator
Hard money loans are short-term, asset-based loans used by fix-and-flip investors: high rates, upfront points, interest-only payments, and a balloon when you sell. Enter the loan and project numbers to see your true financing cost and whether the flip actually profits after it.
How to Use the Hard Money Loan Calculator
Enter the loan terms
Hard money lenders quote a loan amount (often a percentage of purchase or ARV), points charged upfront, an annual interest rate (commonly 9–14%), and a short term — usually 6–18 months.
Add the project numbers
Your purchase price, rehab budget, expected after-repair value (ARV / sale price), and selling costs (agent commissions, closing, staging) as a percentage of the sale.
Read the financing cost
Points plus interest-only carry over the term is the real cost of the money. Because hard money is short-term and interest-only, a delay in selling directly burns more carry — model a longer term than you hope for.
Check the profit and cash in
The headline profit is what's left after everything. "Cash needed in" is the down payment the loan doesn't cover, plus points and carry you fund out of pocket. A thin profit on a flip is dangerous — leave margin for overruns.
Hard Money — Expensive, Fast, and Built for Flips
Why Flippers Pay So Much for Money
Hard money is short-term financing secured by the property itself rather than by your income or credit. Private lenders and funds make these loans to real-estate investors — overwhelmingly fix-and-flippers and BRRRR investors — and they price for speed and risk. Expect upfront points (typically 1–4% of the loan), high annual rates (commonly 9–14%), and a short term of roughly 6 to 18 months, usually with interest-only payments and the full principal due as a balloon when you sell or refinance. Why would anyone pay that? Because hard money can close in days, not the weeks a bank takes; because it will fund a distressed property a conventional lender won't touch; and because it sizes off the after-repair value, letting an investor control a project with less of their own cash. For a flip that turns in a few months, the high rate applies for only a short window, so the dollar cost can be acceptable even at eye-watering APRs.
The number that kills flips is not the interest rate — it's time and the ARV estimate. Because the loan is interest-only and short, every extra month on the market adds carry directly to your cost, and a rehab that runs long or a sale that stalls quickly erodes a thin margin. Equally, the whole deal rests on the after-repair value being real: overestimate the ARV and the profit this calculator shows evaporates at the closing table. Seasoned flippers underwrite conservatively — they assume the project takes longer than planned, budget a contingency on top of the rehab, and use the "70% rule" as a sanity check (pay no more than 70% of ARV minus rehab costs). Run this calculator with a pessimistic ARV and a longer-than-hoped term; if it still profits, the deal has margin.
"On a flip, hard money's interest rate is rarely what hurts you — time is. Every month the property doesn't sell adds carry to a fixed budget, so the deals that fail are the ones underwritten with no slack."
When Hard Money Makes Sense — and the ASEAN Context
Hard money earns its cost when speed or property condition rules out a bank, and when the projected margin is wide enough to absorb the points and carry with room to spare. It's a poor fit for buy-and-hold investors who could use cheaper conventional financing, or for any deal whose profit only works if everything goes perfectly. The professional approach is to treat hard money as a bridge: buy and renovate with it fast, then either sell (a flip) or refinance into a long-term mortgage (the "R" in BRRRR) to pay off the expensive short-term loan. For investors in Singapore and Malaysia, dedicated "hard money" lending is far less common — property financing is dominated by banks under tight MAS and Bank Negara lending rules, and short-term bridging loans exist but are more regulated and conservative. The underwriting discipline still travels: whatever the funding source, a flip only works if the renovated value is realistic, the timeline has slack, and the total cost of money plus selling costs leaves a genuine margin.
10 Facts About Hard Money Loans
Hard money is short-term financing secured by the property, not your income or credit.
Rates are high (commonly 9–14%) with 1–4 points charged upfront.
Terms are short — usually 6–18 months, interest-only, with a balloon at sale.
It's used overwhelmingly by fix-and-flip and BRRRR investors.
Lenders size loans off the after-repair value (ARV), not just the purchase price.
The big advantage is speed — closings in days, on properties banks won't fund.
The deal-killer is time: each extra month adds interest-only carry to a fixed budget.
The 70% rule: pay ≤ 70% of ARV minus rehab costs, as a margin-of-safety check.
Often a bridge: flip and sell, or refinance into a cheaper long-term mortgage.
It's rare in SG/MY, where bank financing under MAS/BNM rules dominates.
Frequently Asked Questions
- A short-term loan secured by real estate rather than your income or credit, made by private lenders or funds to real-estate investors. It carries high rates and upfront points, has a short term (often 6–18 months), and is usually interest-only with the principal due as a balloon when you sell or refinance. It's designed for fix-and-flip projects where speed and the property's potential value matter more than the borrower's financials.
- Points are an upfront origination fee, each equal to 1% of the loan amount. A 2-point fee on a USD 225,000 loan is USD 4,500, paid at closing. Hard money lenders charge points on top of the interest rate as part of their return. Always include points when comparing lenders — a slightly lower rate with higher points can cost more than a higher rate with fewer points on a short loan.
- Hard money prices for speed and risk. Lenders fund distressed properties banks won't, close in days, and base the loan on after-repair value — all riskier than conventional lending. Because the loan is short-term, though, the high annual rate applies for only a few months, so the actual dollar cost on a quick flip can be reasonable. The calculator shows that dollar cost (points + carry) rather than just the APR.
- A flipper's margin-of-safety guideline: don't pay more than 70% of the after-repair value (ARV) minus your rehab costs. On a USD 365,000 ARV with USD 45,000 of rehab, that's (0.70 × 365,000) − 45,000 ≈ USD 210,000 maximum purchase. The 30% buffer is meant to cover financing, selling costs, holding costs, and profit. It's a quick screen, not a substitute for running the full numbers as this calculator does.
- Time and an overestimated ARV. Because the loan is interest-only and short, every extra month on the market adds carry directly to your cost on a fixed budget, and a rehab that runs long compounds it. Equally, if the after-repair value turns out lower than projected, your profit shrinks or disappears at sale. Underwrite both pessimistically — assume a longer hold and a conservative ARV, and only proceed if the deal still profits.
- Less than buying outright, but not zero. The loan usually covers a large share of purchase and sometimes rehab, but you fund the gap (purchase + rehab − loan), the points at closing, and the interest carry during the project. The calculator's "cash needed in" combines these. Many lenders also require you to have reserves, and some fund rehab via draws as work is completed rather than all upfront.
- This calculator models the financing (points + interest) and the transaction (purchase, rehab, selling costs). It doesn't separately itemise other holding costs — property taxes, insurance, utilities, and permits during the rehab — which can add several thousand dollars. For a precise net, add those to your rehab budget or subtract them from the profit shown. They're another reason to keep the projected margin comfortably positive.
- Use hard money when you need to close fast or the property's condition rules out a bank, and the margin is wide enough to absorb the cost. Use conventional financing for buy-and-hold properties in good condition, where its far lower rate wins. A common pattern is to buy and renovate with hard money, then refinance into a conventional loan once the property qualifies — the BRRRR strategy — paying off the expensive short-term loan with cheaper long-term debt.
- Because hard money is interest-only, you don't pay down principal during the term — the entire loan balance comes due in one lump (the balloon) at the end, paid off when you sell the flip or refinance. That's why an exit plan is essential before you borrow: if the property doesn't sell or refinance by the deadline, you must repay the full principal or negotiate an extension, often at additional cost. Never take hard money without a clear, realistic exit.
- Dedicated hard-money lending is far less common than in the US. Property financing in both countries is dominated by banks operating under tight MAS (Singapore) and Bank Negara (Malaysia) lending rules, and short-term bridging loans exist but are more regulated and conservative. The fix-and-flip model itself is less prevalent given stamp duties, seller's stamp duty, and holding rules that penalise quick resale. The underwriting discipline still applies wherever you invest — realistic resale value, slack in the timeline, and a real margin after all costs.
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