Points are an upfront financing cost. One point is 1% of the loan amount and is generally paid at closing. Because this cost does not decline with the holding period, it has a greater proportional effect on shorter projects.
Interest-only payments keep modeled debt service level. Interest is paid during the holding period and principal is due when the property sells or refinances. The analysis therefore applies monthly interest and treats the principal as an exit obligation.
Draw schedules release renovation funds in stages. Many lenders fund the purchase at closing but reimburse renovation costs after completed work is inspected. Confirm the draw schedule and maintain enough working capital to cover contractors before each reimbursement.
General education, not a rate sheet or lending advice. Every lender prices risk differently; obtain a property-specific term sheet before relying on financing costs.