Fix & Flip

You have might have heard the term “fix and flip,” here is the simple definition. They are loans that are typically used for short-term financing to purchase, renovate, and sell property for profit.  

These loans are specifically designed for buying properties that require repairs or upgrades with the intent to quickly sell. The amount is typically based on the current value of the property and the budget for renovations.  

These funds from these loans are typically advanced in stages as construction draws. These loans can be a great option for an experienced real estate investor who understands the market.

Below is an example of terms and costs:

Standard Fix & Flip Loan Terms 

  • Max Loan Amount: $5,000,000

  • Max LTC/ARV (Loan to Cost / After Repaired Value): 
    – Experienced Investors: The Lesser of 85% LTC or 70% ARV. 
    – Inexperienced Investors: The Lesser of 80% LTC or 65% ARV

  • Rates: Starting at 9.99% 

  • Term of loan: 12-18 months

  • Payments: Monthly Interest Payments with Balloon at Maturity

  • Prepayment penalty: None 

Costs: 

  • Origination Fee: 1-2% 

  • Underwriting Fee: $1,500 

  • Feasibility and Contractors Report: $1,200 

  • Draw Fee (for future draws on the loan): $400 

  • Legal: $750 – $1,500 

  • Appraisal Fee: $500-$950 

  • Title Insurance and recording fees: 1% (Approximate) 

  • Standard closing cost 

Property Types: 

  • Condominiums. 

  • Single-family residences. 

  • Two to four units. 

  • Multifamily homes. 

  • Townhouses. 

  • Other property types case by case 

Requirements: 

  • Credit Application 

  • Last 2 bank statements (US bank account) 

  • Copy of ID and Borrowing Entity docs 

  • Purchase Contract (If Purchase) 

  • Project budget/ Scope of work 

  • Approved plans (If applicable) 

  • Track Record Sheet 

  • Contractors information 

  • Property Insurance 

Closing Time: 

  • The Usual Time to Close is  5-10 days. 

Because we are a private lender, we can normally secure a loan in a quicker period of time.

As with most loans, once the title work and appraisals are finished, your loan should be ready to close. 

Ready to pre-qualify?

Click here and one of our loan facilitators will get back to you within 48 hours.