Renovation financing

Fix and Flip Loans

Buy it, fix it, sell it. Fast capital designed for quick turnaround projects.

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Fix and flip loans are short-term financing products designed for investors who buy undervalued or distressed properties, renovate them, and sell for a profit. The loan typically covers both the purchase price and the renovation budget, with funds released in draws as work progresses. These loans are built for speed, usually closing in 1 to 3 weeks.

Typical terms

Loan-to-cost

Up to 90% LTC

ARV limit

Up to 70-75% of after-repair value

Term

12-18 months

Rehab draws

Released at milestones

Property types

SFR, 2-4 unit, townhome

Experience

First-time to experienced flippers

How fix and flip financing works

The lender finances a portion of the purchase price and the rehab budget. Rehab funds are typically held in escrow and released in draws as the contractor completes stages of the renovation. The investor is responsible for the down payment, holding costs during renovation, and any overages.

Once the renovation is complete, the investor lists and sells the property. The loan is paid off from the sale proceeds.

What lenders evaluate

Flip lenders look at the deal as much as the borrower. Key factors include the purchase price relative to the after-repair value, the scope and budget of the renovation, the borrower's track record, and comparable sales in the area.

•Purchase price and as-is value
•Rehab budget and scope of work
•After-repair value based on comparable sales
•Borrower experience and credit
•Timeline and exit strategy (list and sell, or refinance and hold)

First-time flippers

Many lenders have programs for first-time flippers, though they may require a larger down payment or a lower loan-to-cost ratio. Having a clear scope of work, a licensed contractor, and a realistic ARV estimate can help a first-time borrower get approved.

Learn more

Guides related to fix and flip loans

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FAQ

Fix and Flip Loans FAQs

Common questions about this financing option.

Can I get a fix and flip loan with no experience?

Yes. Many lenders offer programs for first-time flippers, though you may need a larger down payment and a strong deal to compensate for limited track record.

How are rehab funds released?

Rehab draws are typically released after inspections confirm that specific milestones have been completed. The lender sends an inspector, verifies the work, and releases the next draw.

What if the flip takes longer than expected?

Most fix and flip loans allow extensions, usually for a fee. Planning for a realistic timeline and including a buffer in your budget helps avoid surprises.

For investors