private money contracts

[Charles Johnson]

This is my first time using private or hard money and I came across a lender who sent me their proposal sheet and Im not sure if this is typical or a good deal for me since im used to borrowing from banks or self funding, if anyone has an opinion please respond. The property is a brick 2 fam 4 br/2 ba, purchase price was 25k paid for by me, the rehab is about 25-35k (still in progress) the arv has been quoted between 90-120k via r.e. agents. here is what was sent to me by the lender

Loan Amount:    Total loan amount of $63,750 or 65% of After Repair Value, whichever is less (Subject to appraisal, inspection, applicant interview and additional underwriting. All required plans must be approved prior to funding, if applicable). Initial Disbursement of $21,250 (which consists of up to 90% of purchase price). Rehab holdback of $42,500. Loan Term:    12-month interest-only balloon note. Payments:    Interest-only monthly in arrears with balloon payment at maturity. Interest Rate:    9.99% fixed interest rate Collateral:    A first priority lien on Borrower’s fee simple interest in the Property and the improvements thereon together with any personal property owned by Borrowers related to Property Prepayment Penalty: none Loan Fees:    The following fees shall be due: (1) 3.00 points, plus customary underwriting, processing, legal, administrative and site inspection fees to (**) at closing of the loan; (2) $50 application fee due upon signing of the term sheet. This fee will cover credit, background, and initial valuation reports (all of which will be shared with the borrower). Upon appraisal being ordered an additional $350 application fee will be due and credited towards closing costs if the loan closes. If the loan fails to close this fee will be forfeited. Closing Fee Schedule • Lender Points • $250 Legal Review Fee • $75 Appraisal Review Fee • $30 Servicing Setup Fee • $30 Draw Company Admin Account Setup Fee • $1,250 Attorney Closing Fee **Draw Fee is $200 per draw and a $30 wire fee for each draw wire**