Skip to content
×
PRO
Pro Members Get Full Access!
Get off the sidelines and take action in real estate investing with BiggerPockets Pro. Our comprehensive suite of tools and resources minimize mistakes, support informed decisions, and propel you to success.
Advanced networking features
Market and Deal Finder tools
Property analysis calculators
Landlord Command Center
$0
TODAY
$69.00/month when billed monthly.
$32.50/month when billed annually.
7 day free trial. Cancel anytime
Already a Pro Member? Sign in here

Join Over 3 Million Real Estate Investors

Create a free BiggerPockets account to comment, participate, and connect with over 3 million real estate investors.
Use your real name
By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.
The community here is like my own little personal real estate army that I can depend upon to help me through ANY problems I come across.
Private Lending & Conventional Mortgage Advice
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated over 8 years ago,

User Stats

2
Posts
0
Votes
Ronnie Darby
  • Investor
  • Somerville, MA
0
Votes |
2
Posts

Lenders Charging Interest on Holdbacks

Ronnie Darby
  • Investor
  • Somerville, MA
Posted

I deal mostly with hard money/private lenders (not sure if that changes the answer):

My first flip involved all of the money at closing, but for this one the lender is disbursing funds as I progress. They're telling me interest is charged on the FULL loan amount, even though I only get about 60% of that at closing. I've done the math and the effective rate is over 20%! They said this is "industry-standard" and "all serious lenders do it".

Is this "standard" based on others' experience? Do most lenders do it? Some? Very few? 

Loading replies...