CALCULATING CASH TO CLOSE
A Guide For Private Money and Hard Money Loans
First thing you'll want to do is grab a pen and paper, then draw a vertical line down the center of the page and horizontal line across the very top leaving you enough room to write some words.
Next you are going to write Money I Need on the left side and Money I Get, on the right side, then you are going to make four rows under each side.
Left side rows in order are:
- Purchase Price
- Rehab Budget
- Closing Costs
- = Money I Need
Right side rows in order are:
- 70% of ARV,
- ARV = $
- X 70%
- = Money I Get
You now fill in each row with the appropriate information and when complete you will have the totals of the two numbers you need to Calculate How Much Money You Need To Bring To Closing,
Money I Need
Purchase Price
Rehab Budget
Closing Costs *
= Money I Need
Money I Get
70% of ARV
ARV =
X 70% (Or You Pick)
70%
= Money I Get
Money You Bring to Closing
The difference between the two is either the money you bring to closing or possibly (although very rarely), the money you receive at closing.
