What points are on a hard money loan
A point is a fee equal to 1% of the loan amount. On a hard money loan, points are the lender's origination charge, collected up front at closing. The CFPB's plain definition (written about consumer discount points) is the same arithmetic: one point equals one percent of the loan amount.
A term sheet may also carry a flat lender fee (processing, underwriting or doc fee) on top of the points. The calculator keeps it separate so you can see both.
Points and the rehab holdback
The iPhone app and these calculators charge points on the whole loan, including rehab money the borrower won't receive until later draws. A lender can define the base differently, so check the term sheet. On the Maple Ave example, the $280,000 loan includes a $100,000 holdback, and 2 points come to $5,600.00. Because points are paid at closing, they add directly to the borrower's cash to close.
Points vs rate: the break-even
A quote with more points and a lower rate costs more on day one and less every month after. The break-even is the number of months where the two totals meet:
In the calculator's example on a $300,000 loan, Quote A (11% + 2 points) costs $4,500.00 more in points than Quote B (12.5% + 0.5 points), and saves $375.00 a month in interest. $4,500.00 ÷ $375.00 = 12 months. At that hold the two totals are equal; if the loan is repaid sooner, Quote B is cheaper, and if it stays out longer, Quote A is.
| Months held | Quote A (11% + 2 pts) | Quote B (12.5% + 0.5 pts) |
|---|---|---|
| 6 | $23,495.00 | $21,245.00 |
| 9 | $31,745.00 | $30,620.00 |
| 12 | $39,995.00 | $39,995.00 |
| 15 | $48,245.00 | $49,370.00 |
A flip loan can be repaid before maturity, so base the comparison on a realistic hold. A rehab that runs two months late moves the answer; a sale that closes early moves it the other way.
What lenders have been charging
Published figures vary with the lenders that report them, so treat each as a snapshot from its date:
- AAPL, using Lightning Docs data: bridge loan points averaged 2.09% in October 2024, and reached as high as 2.33% (report published February 2025).
- SFR Analytics: median fix-and-flip/bridge (RTL) points of 2.0 in March 2026, from lender-submitted data.
- NPLA's June 2026 market report (with SFR Analytics, published July 9, 2026): median RTL points of 0.98. The sample varies as lenders submit data, so the March and June medians aren't directly comparable.
For more context, including rates and leverage, see typical hard money loan terms.
Points from the lender's side
For a lender, points are revenue earned at closing whether the loan runs one month or twelve. That's why a points-heavy quote protects the lender against an early payoff; minimum interest is another way to do that. The private money loan calculator shows points, fee and interest together as gross lender revenue, and the guide to how much hard money lenders make explains why that isn't profit.
Questions
How much is one point on a hard money loan?
One point is 1% of the loan amount. On a $280,000 loan, one point is $2,800 and two points are $5,600.
Are points charged on the full loan or just the amount funded at closing?
The iPhone app and these calculators charge them on the full (gross) loan amount, including the rehab holdback. Check the term sheet, since a lender can define the base differently.
Are hard money points paid upfront?
Points are an up-front charge collected at closing. This calculator and the app deduct them from the loan proceeds, so they increase the cash the borrower needs at closing.
Is it better to pay more points for a lower rate?
Only if the loan will be outstanding longer than the break-even: the extra points divided by the monthly interest saved. For short holds, fewer points and a higher rate can be cheaper.
What's the difference between points and a lender fee?
Points scale with the loan amount; a lender fee (processing, underwriting or doc fee) is a flat dollar amount. Both are paid at closing, and both count as lender revenue.