How to Calculate the Returns on Short Term Real Estate Loans

This podcast examines an actual case study of a short term real estate loan where the interest rate was 13% and the origination fee paid to the lender by the borrower was 1% of the loan amount. The return was about 17%. The podcast shows the actual cash flows received by lender and how the total return was calculated. The point here is that including even a small origination fee increases the annualized returns to the lender substantially.