Hard Money, Zero Points: Instant Side-by-Side Savings Calculator

Zero Point Loan Program: Maximum Flexibility, Minimum Upfront Cost

The Hidden Cost of Traditional Hard Money Lending

Every real estate investor knows the feeling: you’ve found the perfect deal, run your numbers, and you’re ready to move—until you calculate the closing costs. Traditional hard money loans come with points, typically 1-3% of the total loan amount, due at closing. On a $375,000 loan, that’s $3,750 to $11,250 in cash you need to bring to the table before you’ve even started your renovation.

But points are just the beginning. Traditional lenders often layer on additional fees that eat into your returns:

• Exit fees (another 1-2% when you pay off the loan)
• Minimum interest requirements (typically 3-6 months, even if you finish in 2)
• Prepayment penalties
• Processing and underwriting fees
• Wire fees, document fees, and other “junk fees”

These costs add up quickly, reducing your ROI and limiting your ability to scale your investment business.

The AHL Zero Point Advantage

Our Zero Point Loan Program eliminates this burden entirely. We offer a straightforward, transparent trade-off: accept a slightly higher interest rate in exchange for zero points at closing and complete fee transparency throughout your loan.

Complete Fee Transparency

Unlike many lenders who hide costs in the fine print, our Zero Point Program means exactly what it says:

• No points at closing – Keep your cash for the project
• No exit fees – Pay only the principal and accrued interest when you’re done
• No minimum interest requirements – If you finish in 2 months, you pay 2 months of interest
• No prepayment penalties – Complete freedom to exit when your project is ready

Speed Is Your Advantage

The Zero Point Program is designed for efficient operators who can execute quickly. The math is simple: the faster you complete your project and exit the loan, the more money you save compared to traditional points-based loans.

Real-World Example: The Numbers Don’t Lie

Let’s use the exact scenario in our calculator above—a $375,000 loan with a 5-month hold period:

Traditional Points-Based Loan (10% rate + 1% points):

• Points at closing: $3,750 (cash out of pocket day one)
• Monthly interest: $3,125
• Total interest over 5 months: $15,625
• Total cost of capital: $19,375
• Effective cost: 5.17% of loan amount

AHL Zero Point Loan (12% rate + 0 points):

• Points at closing: $0 (keep your cash!)
• Monthly interest: $3,750
• Total interest over 5 months: $18,750
• Total cost of capital: $18,750
• Effective cost: 5.00% of loan amount

Your advantage: $625 saved, plus $3,750 preserved at closing

But here’s where it gets even more interesting. Watch what happens as we adjust the timeline:

The Power of Speed: Different Timeline Scenarios

3-Month Project:

• Points option: $3,750 + $9,375 = $13,125 total (3.50% effective)
• Zero Point option: $0 + $11,250 = $11,250 total (3.00% effective)
• Zero Point Advantage: $1,875 saved

2-Month Quick Flip:

• Points option: $3,750 + $6,250 = $10,000 total (2.67% effective)
• Zero Point option: $0 + $7,500 = $7,500 total (2.00% effective)
• Zero Point Advantage: $2,500 saved

8-Month Hold (When Points Start Making Sense):

• Points option: $3,750 + $25,000 = $28,750 total (7.67% effective)
• Zero Point option: $0 + $30,000 = $30,000 total (8.00% effective)
• Points Advantage: $1,250 saved

The pattern is clear: the Zero Point Program rewards efficiency. The faster you execute, the more you save.

Understanding Cash Flow Impact

The Day-One Difference

When you choose the Zero Point Program on a $375,000 loan, you keep $3,750 in your pocket at closing. This isn’t just about having less cash out—it’s about what that cash can do for you:

• Emergency cushion: Unexpected foundation issue? You have reserves
• Material upgrades: That $3,750 could upgrade kitchens in a flip, potentially adding $10,000+ to your ARV
• Opportunity capital: Another deal comes along? You have the earnest money ready
• Carrying costs: Extra insurance, utilities, and property tax coverage

Monthly Payment Considerations

Yes, the Zero Point option has a higher monthly payment ($3,750 vs $3,125 in our example—a $625 difference). But consider:

• You’re paying this from your rental income or sale proceeds, not upfront capital
• No minimum interest means you stop paying the moment you exit
• The monthly difference is often less than the points you would have paid upfront

Perfect For:

Experienced Flippers

You know your renovation timeline and can execute efficiently. Your systems are in place, your contractors are reliable, and you can accurately predict your project timeline. Why pay points upfront when you’ll be in and out in 3-4 months?

Example: Sarah flips 6 houses per year, averaging 3-month holds. Using Zero Point loans, she saves $11,250 annually in points alone—enough for a down payment on another investment property.

Cash-Conscious Investors

Preserve capital at closing for unexpected repairs, carrying costs, or to pursue multiple projects simultaneously. Every dollar saved at closing is a dollar that can work for you elsewhere.

Example: Marcus had $50,000 for his project. With a traditional loan requiring $3,750 in points, his renovation budget would be squeezed. The Zero Point option let him execute his full scope of work without compromising quality.

Quick-Turn Projects

Cosmetic renovations, wholesale deals, or properties with buyers already lined up benefit most from the Zero Point structure. If you’re painting, flooring, and updating fixtures, why pay for 6 months of minimum interest when you’ll be done in 6 weeks?

Example: Jennifer specializes in cosmetic flips in hot markets. Her average hold time is 2.5 months. The Zero Point Program saves her an average of $2,200 per project compared to traditional points-based loans.

Repeat Borrowers

Building a track record? Save thousands in points across multiple projects throughout the year. Those savings compound quickly when you’re doing volume.

Example: Tom’s investment group completes 10 projects annually. By switching to Zero Point loans, they keep $37,500 in points fees in their capital account each year, allowing them to take on 2 additional projects.

The Dutch vs. Non-Dutch Advantage

Maximizing Savings with Draw Structures

If your loan offers Non-Dutch (draw-based) interest, the Zero Point Program becomes even more powerful. Here’s why:

Traditional Dutch Interest Structure:

• Pay interest on the full $375,000 from day one
• Simple calculation, but potentially paying for money you haven’t used yet

Non-Dutch (Draw) Interest Structure:

• Initial draw at closing: $300,000
• Rehab budget: $75,000 (drawn as needed)
• Pay interest only on what you’ve actually drawn

Let’s see the combined impact using our calculator’s example:

5-Month Project with Non-Dutch Structure:

• Month 1: Interest on $300,000 = $3,000
• Month 2: Interest on $315,000 = $3,150 (assuming linear draws)
• Month 3: Interest on $330,000 = $3,300
• Month 4: Interest on $345,000 = $3,450
• Month 5: Interest on $360,000 = $3,600
• Total interest: $16,500 (vs $18,750 with Dutch structure)
• Additional savings: $2,250

Combined with Zero Points, you’re now saving $625 + $2,250 = $2,875 total on a 5-month project!

The Calculator Tells Your Story

Use our Cost of Capital Comparison Tool above to model your exact scenario. The calculator’s power lies in its flexibility:

Key Variables to Test:

1. Hold Period: Watch how changing from 6 months to 3 months dramatically improves Zero Point savings
2. Loan Amount: Larger loans mean more cash preserved at closing when avoiding points
3. Interest Structure: Toggle between Dutch and Non-Dutch to see the additional savings potential
4. Draw Schedule: If using Non-Dutch, experiment with front-loaded vs. back-loaded draws

Pro Tips for Using the Calculator:

• Model your worst case: Put in a longer hold period than expected. Does Zero Point still win?
• Compare total cost percentages: Look at the “Total Cost of Capital %” for the true comparison
• Check the monthly difference: Make sure you’re comfortable with the higher monthly payment
• Test break-even points: Find out exactly how many months before points-based loans become cheaper

Making the Right Choice

When Zero Points Makes Sense

✅ Choose Zero Points when:

• Your project timeline is under 6 months
• You want to preserve capital at closing
• You value flexibility and no prepayment penalties
• You have multiple projects and need liquidity
• You’re confident in your execution timeline
• You want transparent, predictable costs

When Traditional Points Might Work Better

❌ Consider traditional points when:

• You’re planning a 8+ month hold
• You have excess capital and fewer deals in the pipeline
• You’re doing a bridge-to-permanent financing strategy
• You’re less certain about your timeline and want the lowest possible rate
• The property will be rented before selling (BRRRR strategy)

Common Questions

“What if my project takes longer than expected?”

This is the number one concern we hear, and it’s valid. Let’s math it out:

If your 3-month project becomes a 5-month project:

• Extra cost with Zero Points: 2 months × $625 monthly difference = $1,250
• But you still saved: $3,750 in points – $1,250 extra interest = $2,500 net savings

You’d need to go significantly over timeline before the points option becomes better. And remember—with no prepayment penalty, you can exit the moment you’re ready, not when some arbitrary minimum interest period expires.

“How do I factor in the opportunity cost of points?”

Smart investors think beyond the simple math. That $3,750 in points has opportunity cost:

• Invested in your renovation: Could increase ARV by $10,000+
• Held as reserves: Peace of mind and problem-solving power
• Deployed to another deal: Earnest money for your next project
• Earning returns elsewhere: Even at 10% annual return, that’s $375/year

“What about my relationship with traditional lenders?”

We get it—change is hard, and relationships matter in real estate. But consider:

• AHL’s Zero Point Program is transparent and predictable
• No surprise fees means easier project budgeting
• Faster closings with less upfront cash required
• Your success is our success—we want you to execute quickly and profitably

“Can I really trust there are no hidden fees?”

Absolutely. Our Zero Point promise includes:

• No origination fees
• No exit fees
• No prepayment penalties
• No minimum interest requirements

The only costs are:

1. Your monthly interest payment
2. Third-party costs (title, insurance, etc.)—the same with any lender

Real Success Stories

The Cosmetic Flipper

“I specialize in light rehabs—paint, flooring, kitchens, baths. My average project takes 10 weeks. With my old lender, I paid 2 points upfront plus a 3-month minimum interest. On my last project, a $425,000 loan, I saved $8,500 in points and another $3,500 by not paying that third month of minimum interest. That $12,000 went straight to my bottom line.” – David R., Atlanta

The Volume Investor

“We do 15-20 projects a year. Switching to Zero Point loans kept nearly $100,000 in our operating account last year. That’s two additional projects we could fund. The compound effect is real—more projects, more profits, more growth.” – REI Group, Phoenix

The New Investor

“As a new investor, capital was my biggest constraint. The Zero Point option meant I could take on my first project with $15,000 less at closing. That money became my safety net, which gave me confidence to execute. Project went great, and I saved money too.” – Amanda K., Denver

The Mathematics of Speed

Let’s dive deeper into why speed matters so much with the Zero Point structure:

Traditional Loan Penalties for Speed

Most hard money lenders punish you for being efficient:

• Minimum interest requirements: Finish in 2 months? Pay 3-6 months anyway
• Prepayment penalties: 1-2% for paying off “too early”
• Exit fees: Another 1-2% regardless of timing

Example: On a $375,000 loan with 3-month minimum interest:

• Your 2-month project still costs 3 months of interest
• Extra unnecessary cost: $3,125
• Plus 2 points upfront: $7,500
• Plus 1% exit fee: $3,750
• Total penalty for being efficient: $14,375

Zero Point Rewards for Speed

Our structure rewards efficiency:

• Finish in 2 months? Pay 2 months of interest
• Finish in 6 weeks? Pay 1.5 months of interest
• Every day earlier is money in your pocket

Advanced Strategies

Strategy 1: The Velocity Multiplier

Instead of one 6-month project, execute two 3-month projects:

• Same time period, double the deals
• Points saved: $7,500 (two loans worth)
• Extra interest from higher rate: $3,750
• Net benefit: $3,750 saved plus doubled deal profits

Strategy 2: The Reserve Strategy

Use saved points as permanent reserves:

• $3,750 saved per project
• 4 projects = $15,000 reserve fund
• This fund handles any unexpected costs without touching your returns
• Peace of mind is priceless in real estate investing

Strategy 3: The Scale Strategy

Reinvest points savings to grow faster:

• Year 1: Save $15,000 in points across 4 projects
• Year 2: Use that $15,000 as earnest money for 3 additional deals
• Year 3: You’re now doing 7+ deals annually instead of 4
• Exponential growth powered by fee savings

Ready to Save?

The calculator above shows your personalized comparison. Here’s how to get the most from it:

1. Start with reality: Input your actual typical loan amount and timeline
2. Test the extremes: Try your best-case (2 months) and worst-case (8 months) scenarios
3. Factor in structure: If you qualify for Non-Dutch interest, toggle that option
4. Compare percentages: Look at “Total Cost of Capital %” for apples-to-apples comparison
5. Calculate annually: Multiply savings by your expected number of projects

Remember: The Zero Point advantage isn’t just about one deal—it’s about transforming your entire investment strategy. Less cash at closing, more flexibility during the project, and no penalties for success.

The Bottom Line

At AHL, we believe in aligning our success with yours. The Zero Point Program isn’t just a loan product—it’s a philosophy. We succeed when you execute efficiently and profitably. No tricks, no traps, no hidden fees. Just transparent, flexible capital that lets you focus on what you do best: finding deals, executing renovations, and building wealth through real estate.

The traditional lending model is built on the assumption that lenders and borrowers have opposing interests. We reject that assumption. When you finish your project quickly and successfully, everyone wins. You save money, we can fund more projects, and the cycle of success continues.

Calculate your savings above and discover why more investors are choosing the Zero Point advantage for their projects. The math is clear, the structure is transparent, and the savings are real. Welcome to a better way of funding your real estate investments.