Rehab Loan Calculator

Size a renovation loan that funds the purchase plus the rehab budget. The loan is capped by both LTV on purchase and an LTV cap on ARV — this calculator applies both rules and shows the cash you'd bring.

Project

Purchase price

Rehab budget

After-repair value

Loan terms

LTV on purchase

LTV cap on ARV

Rate

Term (years)

Rehab months

Loan amount

$268,250

purchase + rehab funded

Cash required

$36,750

your contribution at close

Payment when fully drawn

$2,207

P&I once construction is complete

Interest carry during rehab

$11,019

~50% draw assumption

Reading the number

The loan is sized to the lower of (a) total project cost and (b) the LTV cap on ARV. ARV cap = $288,750 (75% of ARV). Anything above that comes out of pocket.

Rehab loans usually disburse the construction piece in draws as work is completed. During rehab you typically pay interest only on the drawn balance, then full P&I once you finish. Plan reserves to cover both the carry and any draw delays.

How to Use

Enter the purchase price, rehab budget, and projected ARV.
Enter the lender's LTV on purchase (commonly 80–90%) and LTV cap on ARV (commonly 70–80%).
Enter the rate and term — once construction is complete, the loan typically converts to standard P&I.
Enter expected rehab months so the calculator can estimate interest carry on the drawn balance.
Compare loan amount vs. project cost to see how much cash you must bring at closing.

Frequently Asked Questions

What kinds of rehab loans use this math?

FHA 203(k), Fannie Mae HomeStyle, VA renovation, and most private rehab/construction-perm loans share the structure: lender funds purchase plus rehab, draws release funds as work is completed, and the loan converts to a long-term mortgage after completion.

Why are there two LTV limits?

Purchase LTV protects the lender on day one before any rehab is done. ARV LTV protects them on the projected end value — even if you can spend the full rehab budget on paper, the loan can't exceed a percentage of what the property will actually be worth post-rehab.

How do construction draws affect interest carry?

You only pay interest on the funds disbursed, not the full approved loan. As more rehab is completed, more is drawn and the carry rises. This calculator approximates a 50% average draw across the rehab period.

How is this different from a hard money loan?

Rehab loans (especially 203(k) and HomeStyle) carry standard mortgage rates and 15–30 year terms. Hard money is short-term, asset-based, much higher rate, and intended for quick flips. Use a rehab loan when you'll keep the property long term.