HML question - Why can't i think straight???

[Erin Elam]

Please help my brain fog!! When using hard money ... say the HML wants monthly interest only payments. Do you have to also pay 'mortgage' payments to someone else, insurance, the utilities OOP? Or does this get paid out of the funds received from the HML?

Like if the HML gave 100K for the deal, they hold it in some sort of escrow right.. that's how they control the draws right? So if they are holding the 100K, the purchase price (say 70K) would come out of that right?

My brain can't get past this! Ugh! Do you pay the monthly interest on top of the mtg, ins, utilities? 

I remember reading about calculating the holding costs in your MAO formula by J. Scott but i don't have the book with me right now and can't remember if he said calculating the mortgage part of the holding costs was only if paying with a conventional loan.

Please help! Thank you in advance.