How does private lending percentages work?

6 Replies

We have a private lender that will be lending to us. we will be giving them 10%. How do we calculate this and figure out how much we will owe them when we are done with our renovation? We are guessing  the project will approximately take  6 months to complete.

simple method.  10% x amount of loan x percentage of year borrowed. If I was loaning you the money, I would also want a kicker. Maybe a 2 or 3% bonus for making the deal.

Straight payment is the easiest one. 10%*loan amount.

To make it simple, if you borrow $100 000, and you get your project done in 6 months (half a year), it would cost you $5000.

100 000 (loan amount)  x 0.10 (interest) × 0.5 (half a year) = 5000

Thank you guys so much for answering my question. I really appreciate the info. Now I understand and can move forward with my deal! 

Originally posted by @Jenny Seaborn :

Thank you guys so much for answering my question. I really appreciate the info. Now I understand and can move forward with my deal! 

 No worries, happy investing !