Fix and Flip
Fix and Flip Loans Built Around the Renovation Budget
A distressed property will not pass a conventional appraisal, and the seller will not wait 45 days. Flip financing solves both problems by underwriting the finished house instead of the current one.
A fix and flip loan is a short term note, typically 12 to 18 months and often interest only, that funds two things at once: a percentage of the purchase price and the full renovation budget released through inspected draws. Sizing works backward from the after repair value. An appraiser reviews your scope of work and estimates what the property is worth once the work is finished, and the lender lends against that number rather than the peeling condition on the day you close. Interest generally accrues only on the drawn balance, so a rehab that stays on schedule costs meaningfully less than one that drags. Exit is the part underwriters scrutinize hardest. You are either selling into the retail market or refinancing into a longer term rental loan, and that plan has to hold up before anyone funds. Rowhome rehabs in Philadelphia and older stock across Wilmington and Dover are the deals we see most.
Who it's for
- Investors buying properties that cannot pass a conventional appraisal because of condition
- Auction and estate sale purchases where the seller demands a fast close and proof of funds
- Contractors and builders self performing the work who want the rehab budget financed rather than paid from savings
- BRRRR strategy buyers who intend to refinance into a rental loan rather than sell
- Borrowers who can carry each renovation phase before the draw inspection reimburses them
Why choose this loan type
- Renovation costs are financed rather than paid from cash, which keeps capital free for the next acquisition
- Condition issues that kill a conventional or FHA appraisal are irrelevant here, since the loan is priced on the finished product
- Closings commonly run one to three weeks, which is what makes a cash competitive offer possible
- No prepayment penalty on most programs, so an early sale is rewarded instead of punished
Frequently asked
How does the rehab money actually reach me?+
In draws. You fund the purchase at closing and the renovation budget sits in a holdback account. As each phase finishes you request a draw, an inspector verifies the work, and the funds release, usually within a few business days. You carry the cost of each phase until the inspection clears, so the working capital question matters as much as the loan amount.
What does after repair value mean for my leverage?+
Most programs size the total loan against a percentage of the after repair value, commonly around 70%, while also capping the purchase piece at a percentage of price. Both tests apply and the tighter one wins, which is why a deal with a thin spread between purchase price and ARV can fail even when the borrower is strong.
Do I need previous flips to qualify?+
It helps and it prices. First time flippers are fundable, typically at lower leverage and with a real contractor bid attached. Once you can document three or four completed projects in the last two or three years, leverage rises, rates soften, and approvals move much faster.
Send us the deal
Purchase price, scope of work with a budget, and your estimated after repair value. That is enough for us to tell you whether it pencils.
Related loan programs
- Hard money when speed outranks everything
Asset based lending for the deals that need proof of funds and a two week close.
- DSCR refinance as the exit strategy
Finish the rehab, place a tenant, and roll the short term note into permanent financing.
Contact
Talk to Our Team Directly
No call centers, no runaround. Reach out and get real answers on what you qualify for before you fall in love with a house.
Phone
302-600-3197Hours
Mon–Fri 9am–6pm · Sat by appointment
Serving
Delaware · Pennsylvania · Maryland · New Jersey