Plug in ARV, rehab budget, and financing.
Use the actual asking or negotiated price — not a wishlist number.
Recent comps within about a mile — not a wishlist number.
Materials, labor, and permits — before any markup.
Total time from purchase to your expected sale close.
Agent commission, seller-paid closing costs, and any buyer credits you concede to close.
Sets what the lender advances, which decides how much cash you actually put in.
Short-term financing from a private lender, priced above a mortgage.
What the wholesaler charges to assign you the contract. Leave at $0 if you're buying direct.
Title, escrow, and lender fees due when you buy.
Cushion for cost overruns — contractor quotes are rarely exact.
Taxes, insurance, and utilities on the property.
You cover the remainder in cash at closing.
Commonly the full budget, but paid out as draws as work is completed — you front each stage first.
Lenders quote both ceilings and fund the lower one, so raising the purchase or rehab advance alone won't get you past this.
One point is 1% of the loan. Paid up front, so it comes out of your cash, not the loan.
Underwriting, appraisal, and document prep — quoted as dollars, not points.
Earned by the lender even if you sell sooner, and charged on the full loan.
Net profit
$37,616
10.9% of ARV
Cash in
$54,734
Cash-on-cash
68.7%
Annualized
137.4%
Purchase price What you pay the seller | $185,000 |
Rehab budget Your contractor scope as entered | $62,000 |
Rehab contingency 15% of the rehab budget | $9,300 |
Buy-side closing costs 2% of the purchase price | $3,700 |
Holding costs $850/month over 6 months | $5,100 |
Origination points 2% of the funded loan, paid at closing | $4,570 |
Lender fees Underwriting, appraisal, and doc prep | $1,495 |
Loan interest Interest-only over 6 months, drawn progressively | $12,069 |
| Total project cost | $283,234 |
Funded by the loan
$228,500
Sell-side costs
$24,150
This deal ties up $54,734 of your own cash for 6 months to clear $37,616 — a 68.7% return on the cash you put in.
A quick offer ceiling investors use as a sanity check: don't pay more than 70% of ARV minus rehab costs.
$5,500 over the ceiling. That's what the acquisition has to come down before this deal passes.
Point estimates hide risk. Here's the same deal under pressure.
The market can soften 12.1% below your $345,000 ARV before this deal stops making money.
| Scenario | Profit | Cash in | Verdict |
|---|---|---|---|
Base case Your numbers as entered | $37,616 $54,734 cash in | ||
Conservative ARV −5%, rehab +15%, +1 month | $8,123 $67,259 cash in | ||
Stress ARV −10%, rehab +30%, +3 months | -$22,778 $94,193 cash in |
The stress case needs $94,193 in cash — $39,459 more than the base case. $29,750 of that is the 70% of ARV cap: the loan follows the softer ARV instead of your rising costs, and the shortfall is yours to cover.
The rows above move all three at once. Here they are one at a time, off your base case — so you know which number to defend.
ARV −5%
Softer comps
−$16,043
$21,573 left
Rehab +15%
Budget overrun
−$11,256
$26,360 left
+1 month
Slower sale
−$2,862
$34,754 left
ARV −5% is the one that costs you most — it takes $16,043 off this deal on its own. Each bar moves one input and holds the other two where you set them, so they won't add up to the scenarios above.
Start with your purchase price and an after-repair value pulled from recent comparable sales within a mile of the subject property. Rehab budgets are where most deals go wrong: contractors quote optimistically, and a 15% contingency is the minimum a disciplined operator carries. Financing here assumes interest-only hard money. Interest accrues against the balance actually outstanding: the purchase advance funds at closing, and the rehab holdback is released in draws, so a deal with a big rehab budget carries less than its full loan for much of the hold — and a cosmetic deal with no draws carries all of it from day one. Origination points and lender fees are charged too, because they come out of your cash at closing rather than out of the loan.
Pricing the financing itself? The hard money loan calculator breaks out points, lender fees, and cash to close, and annualizes them into the rate the loan really carries.