The loan amount compared to the property’s value. It shows how much of the property’s value is being financed.

Example:
A $200,000 property with a $150,000 loan has a 75%  LTV.

The loan amount compared to the total cost of the project, including purchase price and rehab or construction costs.

Example:
A project costs $250,000 and the loan is $200,000, giving it an 80% LTC.

The estimated value of a property after repairs or improvements are completed.

Example:
A property currently worth $250,000 after renovations will have an ARV of $350,000.

A short-term, interest-only loan secured by real estate value, typically used for fix-and-flips and cash-out refinances.

Example:
An investor uses a hard money loan to quickly finance a fix-and-flip property.

Same as hard money loan: Temporary interest-only financing that helps bridge the gap between buying a property and getting long-term financing.

Example:
An investor uses a bridge loan to purchase a new property before selling another one.

A long-term, amortizing loan based on the property’s cash flow.

Example:
An investor qualifies for a 30-year DSCR loan based primarily on the property’s rental income.

A fee for paying off your loan early.

Example:
A borrower pays an additional fee for paying off the loan before the agreed term.

Interest calculated on the full loan amount including funds held in escrow. The interest payment does not change based on amounts drawn.

Example:
The borrower on a fix-and-flip project pays interest from day one based on purchasae funds and money held in escrow for improvements.

An upfront fee based on a percentage of the loan amount paid to the lender at closing. Often called “origination fee.”

Example:
On a $200,000 loan, 2 points = $4,000.

Same as points. A lender fee for processing your loan application paid at closing.

Example:
A 1% origination fee on a $200,00 loan is $2,000.

The date when the loan is due in full.

Example:
A loan with a 12-month maturity is due in full after 12 months.

The lender’s right to demand full repayment early as agreed on in the loan documents.

Example:
If a borrower defaults, the lender may accelerate and require the remaining balance to be paid immediately.

A refinance loan on a property where the borrower does not receive cash at closing.

Example:
A borrower refinances a higher interest rate loan of $400,000 with a lower interest rate $400,000 loan.

A refinance loan on a property where the borrower receives cash at closing.

Example:
A borrower refinances a loan of $400,000 with a loan of $500,000 and nets $100,000.