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Hard Money Loan Calculator — Compare Cash vs Financing

See exactly what hard money financing costs — and whether leverage helps or hurts your deal. Model origination points, interest rate, LTV, and compare cash-on-cash returns for all-cash vs hard money side by side.

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What Is a Hard Money Loan?

A hard money loan is a short-term, asset-based loan used by real estate investors for acquisitions and renovations. Unlike traditional mortgages, hard money lenders approve loans based primarily on the property's value (and its projected ARV) rather than the borrower's credit score or income.

Hard money loans typically feature: 6–18 month terms, 8–14% annual interest rates, 1–3 origination points (% of loan amount paid upfront), loan-to-value ratios of 65–80% of purchase price, and sometimes partial funding of renovation costs.

Hard Money Total Cost Formula
Total Financing Cost = Origination Points + (Monthly Interest × Hold Months)
Example: $91,000 loan, 2 points, 12% rate, 6 months = $1,820 + $5,460 = $7,280 total financing cost

All Cash vs Hard Money: Which Is Better?

The answer depends on your capital position and deal specifics. Hard money leverage can significantly increase cash-on-cash returns when used correctly, but it also increases risk and total cost. Here's how to think about it:

FactorAll CashHard Money Capital requiredFull deal cost30–50% of purchase + reno share + fees Financing cost$0$5,000–$20,000+ depending on loan size/term Cash-on-cash returnLower (more cash invested)Higher when profitable (less cash in) Risk exposureLower (no debt obligation)Higher (monthly payments continue if deal stalls) Number of simultaneous dealsLimited by capitalCan run more deals with less capital Best forHigh-confidence deals, cash-rich investorsCapital-efficient investors, scaling up

How to Evaluate a Hard Money Lender

Not all hard money lenders are equal. When evaluating lenders, focus on these factors:

What Is Cash-on-Cash Return?

Cash-on-cash (CoC) return measures your net profit divided only by the cash you personally invested — not the total deal cost. When using hard money, your personal cash investment is lower (the lender funds most of the purchase), so CoC return is typically higher than ROI when the deal is profitable.

Example: $62,000 net profit on a deal where you personally invested $80,000 in cash (with hard money funding the rest) = 77.5% cash-on-cash return, even though the total deal ROI might be 35%. This is why leverage can dramatically amplify returns on successful flips. Use our Financing Calculator to model both metrics for your deal.