The loan-to-value (LTV) ratio for private money loans can vary depending on the lender and the specific terms of the loan. Private money lenders are typically less strict in their lending requirements than traditional lenders, such as banks and credit unions.
Private money lenders may be willing to lend up to 70-80% of the property’s value, although some lenders may be willing to lend up to 90% or more of the property’s value. However, the LTV ratio is often based on the “as-is” value of the property rather than the after-repair value (ARV) for a fix-and-flip loan.
It’s important to note that private money loans usually come with higher interest rates and fees than traditional loans due to the increased risk for the lender. Borrowers should carefully consider the terms and costs of the loan before agreeing to the terms.