Private loan fees: the full list

Fees paid at the start

• Opening fees, often one to three percent
• Brokerage fees, agreed in advance
• Property appraisal
• Legal fees for both parties
• Title insurance, where required

Fees paid later

• Renewal fees at maturity
• Discharge fees at the end of the loan
• A penalty if you repay early

The calculation to run

Add all fees and interest. Divide by the amount received, then compare.

How fees stack up

A two hundred thousand dollar loan can carry ten thousand in fees.

Over a twelve-month term, that equals five extra points of rate.

Fees that can be negotiated

• Opening fees, depending on competition
• Brokerage fees, agreed in advance
• Renewal fees, set in the contract
• The penalty, sometimes cut to one month

What cannot be negotiated

Notary fees and registration duties are set elsewhere.

Fees deducted at source

Most fees are deducted from the amount advanced.

You borrow a hundred thousand dollars but receive ninety-five thousand.

Always base your needs on the net amount received.

Comparing with an institutional option

Before accepting, check whether an institution can meet the need.

The timeline is longer, but the cost markedly lower.

A private loan is justified mainly when time is short.