Updated Rates as of August 2026
Hard money lenders typically charge 0–3 origination points, where one point equals 1% of the loan amount due at or before closing. On a $200,000 loan, 2 points = $4,000.
Jaken Finance Group discloses points on the term sheet before processing. Compare points vs rate on the same hold months — see fix and flip loan points and fees.
| Loan amount | 1 pt | 2 pts | 3 pts |
|---|---|---|---|
| $150,000 | $1,500 | $3,000 | $4,500 |
| $200,000 | $2,000 | $4,000 | $6,000 |
| $400,000 | $4,000 | $8,000 | $12,000 |
Points vs rate trade-off on short holds
One point = 1% of loan amount, due at or before closing. Lenders trade points for rate — strong sponsors with lower leverage often earn fewer points at a similar rate.
| Hold period | Better structure |
|---|---|
| 4–6 months | Lower points, accept slightly higher rate |
| 9–12 months | Negotiate rate down; points matter less |
| BRRRR 12+ months | Minimize points on bridge; model DSCR exit at 5.75%–10.5% |
Worked comparison — $200K loan, 8-month hold
| Structure | Rate | Points | Points $ | IO (8 mo) | Total finance |
|---|---|---|---|---|---|
| Low rate | 9.5% | 3.0 | $6,000 | ~$12,667 | ~$18,667 |
| Balanced | 10.75% | 1.5 | $3,000 | ~$14,333 | ~$17,333 |
| Low points | 11.5% | 0.5 | $1,000 | ~$15,333 | ~$16,333 |
Jaken Finance Group discloses 0–3 points on the term sheet before processing. Never pay large upfront fees before a written quote. Fix and flip loan points and fees · how much does hard money cost
When to negotiate points down
| Your leverage | Negotiation angle |
|---|---|
| 70% LTC or lower | Ask for 0.5–1.0 pt reduction |
| 5+ documented exits | Repeat sponsor pricing |
| Multiple simultaneous files | Portfolio relationship |
| Strong ARV spread (30%+) | Rate/point trade available |
Never accept a verbal quote — points appear on the written term sheet from Jaken Finance Group before processing.
Points on BRRRR vs pure flip
| Strategy | Points priority |
|---|---|
| 6-month flip | Minimize points — short hold |
| 12-month BRRRR | Balance points vs rate — longer carry |
| Bridge to DSCR | Minimize bridge points; model DSCR at 5.75%–10.5% |
Hard money cost overview · fees schedule · checklist for loan proposals
Points vs rate tradeoff — worked example
On a $280K loan, 2 points ($5,600) with 10.25% IO vs 1 point ($2,800) at 11.25% IO over 8 months:
| Structure | Upfront | 8-mo IO | Total finance |
|---|---|---|---|
| 2 pts / 10.25% | $5,600 | ~$18,200 | ~$23,800 |
| 1 pt / 11.25% | $2,800 | ~$20,000 | ~$22,800 |
Lower points win on short holds; lower rate wins beyond 12 months. Jaken Finance Group charges 0–3 points on bridge and flip within 8.99%–13.5% IO.
When to negotiate points down
Sponsors with repeat track record, lower LTC (more cash in), or clean title in 7 days have leverage. Points rarely drop on first deals or distressed collateral. Ask for ysp disclosure — some brokers mark up points without lowering rate. Fees schedule · hard money cost guide · evaluating proposals · calculator
Points on different loan sizes — sensitivity analysis
| Loan amount | 0.5 pt | 1.5 pts | 3 pts |
|---|---|---|---|
| $125,000 | $625 | $1,875 | $3,750 |
| $200,000 | $1,000 | $3,000 | $6,000 |
| $350,000 | $1,750 | $5,250 | $10,500 |
| $500,000 | $2,500 | $7,500 | $15,000 |
On small loans, fixed processing fees ($995–$1,500) hurt more than points — a $125K loan with 2 points ($2,500) plus $1,200 processing = 3% upfront friction.
Broker vs direct lender points
| Source | Typical points | Transparency |
|---|---|---|
| Direct lender (JFG) | 0–3 on term sheet | Disclosed upfront |
| Broker | 1–4+ (YSP markup) | Ask for rate/point split |
| Referral partner | Varies | Get written quote |
Jaken Finance Group discloses 0–3 points on the term sheet before processing — no surprise at closing within the 8.99%–13.5% IO band.
Tax treatment — points on investment property (consult CPA)
Investors often amortize origination points over the loan term on rental property — flips may treat points differently depending on hold period and entity structure. This is not tax advice — bring your HUD-1 to a CPA who works with real estate investors.
Points negotiation scenarios
| Your position | Realistic ask |
|---|---|
| First deal, 85% LTC | Unlikely to reduce points |
| 5+ HUD-1s, 80% LTC | 0.5–1.0 pt reduction |
| Two simultaneous files | Portfolio pricing |
| Paying 25%+ cash to close | Rate/point trade available |
Never pay non-refundable processing before a written term sheet showing points, rate, LTC, ARV cap, and minimum interest terms.
Points on rescue and rush files — premium pricing
| File type | Typical points | Why |
|---|---|---|
| Standard flip, 14-day close | 1–2 | Normal underwriting |
| Rescue / double close | 2–3 | Compressed timeline |
| First-time sponsor | 2–3 | Higher risk tier |
| Repeat sponsor, 7-day close | 0.5–1.5 | Relationship pricing |
Rescue capital at 8.99%–13.5% IO saves the deal — extra point on $250K ($2,500) beats losing a $20K wholesale fee.
Rollover points — second deal with same lender
Some sponsors negotiate reduced points on deal two when deal one pays off clean:
| Deal | Points | Condition |
|---|---|---|
| Deal 1 | 2.0 | Standard |
| Deal 2 (within 90 days) | 1.0–1.5 | Prior payoff on time |
| Deal 3+ | 0.5–1.0 | Track record established |
Submit HUD-1 from prior close with new application — do not assume automatic repeat pricing.
YSP disclosure — reading a broker term sheet
| Line item | Meaning | Your action |
|---|---|---|
| Lender origination 1.0 pt | Goes to lender | Expected |
| Broker compensation 1.0 pt | YSP markup | Negotiate or go direct |
| Admin fee $1,500 | Processing | Compare to direct lender |
| Total upfront | Sum all | Compare all-in, not rate alone |
Jaken Finance Group as direct lender discloses origination on the term sheet — no hidden broker markup within the 8.99%–13.5% band.
Points vs minimum interest — combined upfront math
| Term sheet | Points | Min interest | 5-mo hold, $220K loan |
|---|---|---|---|
| A: 1 pt, 6-mo min | $2,200 | 6 mo IO | Pay 6 mo even if sell at 5 |
| B: 2.5 pt, 3-mo min | $5,500 | 3 mo IO | Higher points, less min IO |
On 5-month holds, 3-month minimum with higher points may cost less total than 6-month minimum with lower points — model both.
Worked example — points decision on $340K Atlanta flip
| Offer | Rate | Points | 7-mo IO | Total finance |
|---|---|---|---|---|
| Lender A | 10.25% | 2.5 ($8,500) | $17,100 | $25,600 |
| Lender B | 11.50% | 0.5 ($1,700) | $19,200 | $20,900 |
| JFG (example) | 10.75% | 1.5 ($5,100) | $18,000 | $23,100 |
Lender B wins on 7-month hold despite highest rate — always model your actual hold months.
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