Avatar's Blog
» Monthly Payment on Hard Money Loans
Posted on 6/3/2005
Hard money lenders ask three questions before funding any loan:
1 - Is the property value sufficient to serve as collateral for this loan? (see below)
2 - Can the borrower comfortably afford the monthly payments?
3 - Is there a clear exit strategy?
Today, we will focus on quetion two.
Avatar Financial Group offers interest-only payments. Therefore, determing the monthly payment is fairly straightforward. Take the loan amount, multiply by the interest rate and deivide by twelve. Make sure to add any points into the loan, as they are wrapped into the loan to reduce your out of pocket expenses at closing.
Avatar likes to see a ratio of at least 1.2 : 1 of income to expenses. We are here to make loans that make sense for the borrower as well as the lender.
Posted in Miscellaneous
1 - Is the property value sufficient to serve as collateral for this loan? (see below)
2 - Can the borrower comfortably afford the monthly payments?
3 - Is there a clear exit strategy?
Today, we will focus on quetion two.
Avatar Financial Group offers interest-only payments. Therefore, determing the monthly payment is fairly straightforward. Take the loan amount, multiply by the interest rate and deivide by twelve. Make sure to add any points into the loan, as they are wrapped into the loan to reduce your out of pocket expenses at closing.
Avatar likes to see a ratio of at least 1.2 : 1 of income to expenses. We are here to make loans that make sense for the borrower as well as the lender.
Blog Navigation
