The Cost Of Money Is Your Decision
How can the cost of the money you are borrowing cost be impacted by the person borrowing it? The simple answer with private money is to break down the cost on a monthly basis and not yearly. The average cost of money will run between 1-1.5% per month while the loan is open. The average flipper goes from sale to sale in 5-7 months. Because of this, they are paying 5 months x 1% per month on the money they have borrowed. The gross amount often ends up around 9-11%. The speed of the flipper has everything to do with how cheap or expensive private money ends up being.
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