Hard Money Basics
The Full Cost of a Hard Money Loan, Itemized
No jargon and no sales pitch. This is how we explain it at the Averlend desk, with the math that matters.
Hard Money Basics
The short version, then the substance.
Key Takeaways
- The big three
- The costs people forget
- The cost that matters most
The big three. Interest, points, and closing costs. Interest accrues monthly over your hold, points are paid at close, and closing costs cover title, recording, and document preparation. Model all three over your real timeline, not the best-case one.
The costs people forget. Insurance, property taxes during the hold, utilities, and the extension fee if the project runs past maturity. None of these are lender tricks. They are the carrying cost of the project, and the spreadsheet needs them.
The cost that matters most. Time. Every month of hold is interest, taxes, insurance, and opportunity. A lender who funds draws fast and answers the phone saves you more money than a quarter-point of rate ever will.
The South Texas angle. Averlend underwrites this every week in Corpus Christi and across Nueces County. If you are working a deal in downtown or anywhere else in the metro, the theory above comes with a local desk attached: see our Corpus Christi lending page or send the deal directly.
Questions
Quick answers from the Averlend desk.
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