Advanced training
You know what LTC and LTARV mean. Now learn how they interact as dual constraints, how interest reserves affect borrower cash needs, how to run sensitivity analysis on tight deals, and how to apply profit tests that give both you and your borrower confidence the deal works.
Curriculum
The difference between a deal that funds smoothly and one that stalls in underwriting usually comes down to preparation. Brokers who understand the math behind dual constraints, interest reserve calculations, and profit margin analysis catch problems before they become surprises, and structure deals that underwriters approve faster.
Fix & Flip 201 covers the analytical skills that separate order-takers from real advisors.
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FAQ
Common questions about this course topic.
A dual constraint means the loan amount is limited by both LTC (loan-to-cost) and LTARV (loan-to-after-repair-value) simultaneously. The borrower gets the lower of the two calculations, which prevents over-leveraging on either the cost or value side of the deal.
Interest reserves are prepaid interest held by the lender and drawn down monthly to cover the payment obligation of the borrower. They reduce monthly cash burden during renovation but increase the total cash needed at closing.
Most lenders want to see at least 10-15% gross profit margin after all costs. Some programs have explicit profit tests while others evaluate feasibility more holistically. A thin margin increases risk for both the borrower and the lender.
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Free course on fix and flip lending: LTC, LTARV, ARV, experience tiers, rehab draws, and the full flip deal lifecycle from purchase to profit.
View course →Expert fix and flip course: rehab draw management, scope of work, contractor coordination, BRRRR refi-out strategy, permits, liens, and environmental surprises.
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