Fix and Flip Loans: The 6 Best Fix and Flip Financing Options

Fix and flip loans are used by short-term real estate investors to purchase and renovate a property before flipping it for a profit. This type of financing for flipping houses offers investors fast closings for properties in any condition. The most popular type of fix and flip loans are hard money loans.

LendingHome offers fix and flip loans to investors with competitive rates for prime borrowers. You can get prequalified online in minutes, see your exact rates, and receive funding in as little as 15 days. Additionally, there is no prepayment penalty for early repayment.

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Types of Fix and Flip Loans

The six types of fix and flip loans are:

1. Fix and Flip Hard Money Loan

A hard money loan is a short-term loan secured by real estate and used by fix and flippers to purchase and renovate a property. Investors typically use hard money loans to purchase, renovate, and sell a property within one year. These loans are ideal for fix and flippers since they finance properties in poor condition.

Hard money loans, also referred to as rehab loans, have lower qualifications for approval, helping fix and flip investors receive approval and funding in as little as 15 days. Hard money lenders care more about the property and its potential value than about the borrower’s background.

LendingHome is a national hard money lender that helps experienced and inexperienced fix and flippers finance investment projects. Rates are competitive for prime borrowers and prequalification takes minutes. You can fill out their brief online application in 10 minutes or less.

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Fix and Flip Hard Money Loan at a Glance

Who Fix and Flip Hard Money Loans Are Right For

These fix and flip house flipping loans let experienced fix and flippers conduct their own renovations while allowing novice flippers to use a licensed contractor. Regardless of expertise, the funding of a hard money loan can happen in as little as 15 days.

Hard money rehab loans are right for the following investors:

• Experienced flippers with two to three past rehab projects
• First-time investors who will have help from a licensed contractor
• Fix and flippers who need to compete with all-cash buyers

Fix and Flip Hard Money Loan Rates, Terms & Qualifications

Hard money loans typically have lower qualifications for approval than conforming loans, helping fix and flip investors receive approval and funding in as little as 15 days. Hard money loan rates are typically higher than conforming loans starting at seven percent and short loan terms.

Fix and Flip Hard Money Loan Rates & Terms

Hard money loans, also known as rehab loans, have high rates but they offer short terms and can even finance renovations. Lender fees are taken directly out of the loan and closing costs are either paid out of pocket or taken directly out of the loan. When you consider the cost and fees along with the rates, it’s obvious that hard money loans don’t come cheap.

Hard money loans rates and terms are:

• Term: 1 – 3 years
• Time to Funding: 15 days
• Rates: 7% – 12%
• Lender Fees: 1.5% – 10%
• Closing Costs 2% – 5%

Hard money loans typically don’t have a prepayment penalty, and you can reduce the overall financing costs by paying the loan back early. Monthly, interest-only payments are made during the loan and the principal repayment is at the end of the loan term. Hard money loans generally finance 90 percent of a property’s loan-to-value (LTV) and 80 percent of a property’s after-repair-value (ARV).

If you want to find out how much a hard money loan will cost you, check out our free hard money loan calculator.

You’re not paying the interest on a hard money loan for very long since you can usually flip a home in less than six months. To help speed up the process, hard money lenders such as LendingHome offer prequalification in as little as three minutes and funding within 15 days. This helps fix and flip investors compete with all-cash buyers, especially at real estate auctions.

Fix and Flip Hard Money Loan Qualifications

Hard money loans typically carry these minimum qualifications:

• Credit Score: 550+ (check your credit score for free here)
• Debt-to-Income Ratio: 35% – 45%
• Experience: Two to three past rehab projects for DIY projects or licensed contractor help for inexperienced fix and flippers

Hard money loans offer comparatively easier qualifications when compared to the other options on our list. However, a credit score of 640 or above is preferred. Borrowers with better credit scores and a longer history of successful fix and flip projects will be seen as safer and likely qualify for lower rates and fees as well as higher borrowing limits.

Where to Find a Fix and Flip Hard Money Loan

Hard money loans are issued by hard money lenders. These lenders can either be found online or in-person. Traditional hard money lenders are typically found offline through industry relationships. Online hard money lenders, on the other hand, conduct their business completely over the internet. With these lenders, prequalification takes less than a day and funding can be received in as little as 15 days.

For more information on the best hard money lenders in your area, check out our hard money lender directory that offers a list of lenders in all 50 states.

LendingHome is an online hard money lender that offers competitive rates for prime borrowers, monthly payments that are interest-only, and no prepayment penalties. They can fund loans in as little as 15 days and prequalification takes just a few minutes.

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2. Cash Out Refinance for Fix and Flip Investments

A fix and flip cash out refinance is a strategy where a fix and flip investor refinances an existing property to finance the purchase of a new investment property. A cash out refinance helps fix and flippers extract equity from an existing property by issuing a new loan and paying off the existing mortgage.

The new loan issued on a cash out refinance is considered a “first lien.” This means that any existing liens (such as the original mortgage) must be paid first before you’re able to extract any equity. The difference between the amount of the new loan and the amount of the old mortgage is the cash a fix and flip investor can use to finance other investments.

There are no restrictions on how a fix and flip investor spends the cash received from a cash out refinance. Fix and flip investors can use a cash out refinance, also known as a “cash out refi,” on an owner-occupied home as well as a non-owner-occupied investment property (up to four units).

Visio Lending offers real estate investors a way to refinance an existing property or portfolio of properties. Their cash out refi offers range from 24-month bridge loans to 30-year rental loans with competitive rates for prime borrowers. You can prequalify online in just a few minutes.

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Fix and Flip Cash Out Refinance at a Glance

Who a Cash Out Refinance Is Right For

Cash out refinances are only used by real estate investors who already have an existing property. They’re investors who want to get money to flip a house and compete with all cash buyers without turning to hard money. A cash out refi can only finance up to 75 percent of the existing property’s loan-to-value (LTV) ratio.

Cash out refinances are best for the following types of investors:

• Fix and flippers with an existing owner-occupied primary residence
• Fix and flippers with an existing non-owner-occupied investment property
• Fix and flippers with at least 30% to 40% of equity in an existing property

A cash out refi is also perfect for portfolio investors. This is because portfolio investors typically own an existing property with enough equity to execute a cash out refinance. These portfolio investors typically use a cash out refi as a down payment on a blanket mortgage or a portfolio loan. These blanket mortgages can finance four or more properties under a single loan and are perfect for investors with multiple houses.

Fix and Flip Cash Out Refinance Rates, Terms & Qualifications

Cash out refinances provide funding for flipping homes and typically offer competitive rates and long loan terms from 15 to 30 years. Fix and flip cash out refinance qualifications are generally stricter than hard money loan qualifications because the lender wants to make sure the borrower can afford a new, higher loan amount.

Fix and Flip Cash Out Refinance Rates & Terms

The interest rates on a cash out refi are typically lower than with a traditional mortgage. This is because the borrower already has a track record of good payments. However, since a cash out refinance is more complicated than a regular bank loan, lenders typically charge higher fees.

The rates and terms on a cash out refinance are as follows:

• Term: 15 – 30 years
• Time to Approval: 30 – 45 days
• Rates: 3.99% – 6%
• Loan Origination Fees: 3%
• Closing Costs: 2% – 5%

Lenders typically offer cash out refinances equal to 75 percent LTV on a one-unit property and 70 percent LTV on a two- to four-unit property. This means you’ll need to have somewhere between 30 percent and 40 percent of equity in an existing property for this loan to make sense. You might, therefore, have to use a cash out refinance as a down payment and then use a hard money loan, because even if you have 40 percent equity, that’s really only 15 percent you can pull out, which probably doesn’t cover the purchase of a house.

Since a cash out refinance is a first lien, borrowers are required to cover closing costs between two percent and five percent of the existing property’s fair-market-value (FMV). Closing costs are either taken directly out of the loan or paid out of pocket. Once the loan is issued, the lump sum amount is used to pay off the existing loan and the remainder is wired directly to a borrower’s bank account.

Fix and Flip Cash Out Refinance Qualifications

The qualifications on a cash out refinance are typically more stringent than with other fix and flip loans. This is because a cash out refinance is usually issued by a traditional bank or mortgage lender rather than an online or hard money lender.

Specifically, a fix and flipper should expect the following cash out refinance qualifications:

• Minimum Credit Score: 640+ (check your credit score for free here)
• Debt-to-Income Ratio: 45% or less
• Cash Reserves: 0 – 6 months
• Debt Service Coverage Ratio (DSCR): 1.25 (if refinancing an existing rental property)
• Personal Tax Returns: Two years

Finally, all fix and flip investors, whether they’re refinancing an investment property or their primary home, should have at least 30 percent to 40 percent equity in the existing property.

Where to Find a Cash Out Refinance

You can find a cash out refinance at any Fannie Mae-approved mortgage lender. They can also be issued by lenders specifically catering to real estate investors. Lenders that focus on investors tend to have more flexibility, and their familiarity with the investing world allows them to get their clients funded more quickly than traditional mortgage companies.

For more information on cash out refinances, check out our in-depth guide on cash out refinances for real estate investors.

Visio Lending offers real estate investors cash out refinance options that range from 24-month bridge loans to portfolio loans to 30-year rental loans. Rates are competitive for prime borrowers. You can get prequalified online in just a few minutes.

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3. Fix and Flip Home Equity Line of Credit

A home equity line of credit (HELOC) can be another type of fix and flip funding for investors. The HELOC works more like a credit card than a conventional loan. Fix and flip investors are issued a line of credit based on the value of their existing home and can use that credit over the HELOC’s term. Just like a credit card, interest rates are only charged on the amount borrowed until the amount is repaid.

Unlike a cash out refinance, a home equity line of credit (HELOC) can be both a first or second lien, meaning that it can be taken out in addition to your existing mortgage. A HELOC can only be issued on an owner-occupied primary residence. There are no restrictions on what a fix and flip investor does with the capital, but the HELOC typically needs to be taken out on a primary residence and not an investment property.

If you’re shopping for a home equity line of credit, you can reach out to one lender at a time hoping you find a good deal. Or, you can visit an online marketplace, like LendingTree, and review offers from multiple lenders at once. Save time, shop smart, and find a HELOC that fits.

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Fix and Flip Home Equity Line of Credit at a Glance

Who Home Equity Lines of Credit Are Right For

Home equity lines of credit (HELOCs) are only issued on an owner-occupied primary residence. HELOCs typically can’t be taken out on an investment property. Further, the combined loan-to-value ratio (CLTV) cannot exceed 85 percent of the home.

Once a home equity line of credit (HELOC) is issued, a fix and flipper can use it to finance any investment purchase. Fix and flippers will typically use the cash from a HELOC to purchase and renovate an investment all cash or use as a down payment on a hard money loan.

The real value in a HELOC, however, is in its credit structure. Since it’s not a loan, fix and flippers can get approved for a home equity line of credit (HELOC) and take their time looking for an opportunity. Interest doesn’t start accruing until an actual draw is made. HELOCs allow fix and flip investors to set a maximum budget and wait for the right opportunity, such as with a foreclosure property.

Therefore, HELOCs are best for the following investors:

• Fix and flip investors with an owner-occupied primary residence
• Fix and flip investors with more than 15 percent home equity
• Fix and flippers without a specific project in mind

For more information on HELOCs, their rates, terms and if they’re right for you, check out our guide on home equity lines of credit.

Fix and Flip Home Equity Line of Credit Rates, Terms, & Qualifications

A home equity line of credit typically offers competitive rates starting at 4.5 percent and long terms from 25 to 30 years. The qualifications for this type of fix and flip funding tend to be standardized, a minimum FICO score of 640 is generally needed, and the HELOC can only be used on an owner-occupied property.

Fix and Flip Home Equity Line of Credit Rates & Terms

The overall term of a HELOC is broken down into two phases. The first five to ten years is known as the draw period, while the following 20 years is known as the repayment period. During the draw period, borrowers are free to borrow up to their maximum line of credit and pay interest-only monthly payments. During the repayment period, fix and flip investors stop borrowing and start repaying the principal.

A home equity line of credit (HELOC) has rates and terms of:

• Term: 25 – 30 years
• Time to Approval: 30 – 45 days
• Rates: 4.5% – 5.5%
• Loan Origination Fees: 2%
• Repayment: Monthly, interest-only for first 5 to 10 years; interest and principle for the remaining 15 to 20 years

The maximum loan amount is equal to 85 percent of a property’s combined LTV, which means the first mortgage and second HELOC combined cannot exceed 85 percent of a property’s current fair market value. Since a HELOC is considered a second mortgage, borrowers aren’t required to pay closing costs.

Fix and Flip Home Equity Line of Credit Qualifications

A home equity line of credit (HELOC) generally has fairly standard qualifications regardless of where you obtain it. A borrower needs to meet the minimum FICO score requirement and debt-to-income ratio. The borrower will also need to show equity in their existing property.

Borrowers should expect to meet the following qualifications prior to applying for a HELOC:

• Credit Score: 640+ (check your credit score for free here)
• Debt-to-Income Ratio: 45% or less
• Minimum Equity: 30% in existing property

Further, HELOCs are only allowed on an owner-occupied primary residence. However, lenders aren’t concerned with what an investor does with the money after it’s been issued. If you’re instead looking for a line of credit on your investment property, you can read about an investment property line of credit below.

Where to Find a Fix and Flip Home Equity Line of Credit

Investing in real estate requires having access to the right capital, and for those with equity in existing primary residence, a HELOC can be a great choice. Home equity lines of credit (HELOC) are available at most national banks and mortgage lenders.

If you’re shopping for a home equity line of credit, you can reach out to one lender at a time hoping you find a good deal. Or, you can visit an online marketplace, like LendingTree, and review offers from multiple lenders at once. Save time, shop smart, and find a HELOC that fits.

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4. Fix and Flip Investment Property Line of Credit

An investment property line of credit (LOC) is a line of credit similar to a Home Equity Line of Credit (HELOC), except it’s specifically used on investment properties. It works like a credit card where you only pay interest on the money that you actually use. This LOC is for short-term cash needs and can be used for both purchases and renovations of fix and flips.

An investment property LOC can only be used on non-owner-occupied properties. However, it’s possible to get either a single asset investment property LOC or a portfolio investment property line of credit. While you typically need to outline your expected use for the LOC in your application, you can usually use it for whatever you want once it’s funded.

CoreVest offers an investment property line of credit starting at $1MM for single assets or portfolios. Their lines of credit are up to 80 percent of a property’s cost with terms between 18 and 24 months. The line of credit offers experienced flippers with significant equity in an existing portfolio a high degree of flexibility and speed.

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Investment Property Line of Credit at a Glance

Who Investment Property Lines of Credit Are Right For

Investment property lines of credit are right for fix and flip investors who want a short-term loan in order to purchase and/or rehab a property and then flip it and pay off the line of credit. Long-term investors with substantial equity in their property and a high credit score, but may be short on cash, may also benefit from an investment property LOC.

Specifically, an investment property line of credit is right for the following investors:

• Fix and flip investors with at least 30% to 40% equity in an existing non-owner-occupied property
• Fix and flippers with a portfolio of rental properties who want to purchase and/or renovate a fix and flip
• Fix and flip investors who want access to financing but might not have a current use for it

To find out more about an investment property line of credit and if it’s right for you, check out our in-depth guide on investment property lines of credit.

Fix and Flip Investment Property Line of Credit Rates, Terms, & Qualifications

An investment property line of credit provides fix and flip funding to investors. These products’ rates are typically higher than HELOC rates because they’re on an investment property and not a primary residence, and the bank looks at this as riskier. Terms are typically short and qualifications are based on the amount of equity in the property and the borrower’s financial history, including credit score.

Fix and Flip Investment Property Line of Credit Rates & Terms

The rates for an investment property line of credit are based on the borrower’s credit score and credit history as well as on the investment property itself. The terms are set by the bank offering the line of credit. The rates and terms vary from single asset to portfolio LOCs.

The single asset investment property line of credit rates and terms include:

• Term: 18 – 24 months
• Time to Approval: Up to 30 days
• Rates: 5.2% – 8%
• Loan Origination Fees: 1% – 2%
• Closing Costs: 1 – 5%

There are also sometimes annual service fees around $75. Minimum lines of credit on single assets are as low as $25,000, while minimum lines of credit on a portfolio of properties is typically around $1 million. Investment property lines of credit are usually capped at 75 percent LTV or at 80 percent of cost.

Fix and Flip Investment Property Line of Credit Qualifications

An investment property line of credit for a single asset has certain qualifications that a borrower and their property must meet in order to get approved. A portfolio LOC has stricter qualifications and looks more at the borrower’s overall financial standing. Generally, all LOCs require a certain amount of equity to be in the property.

Typical investment property lines of credit qualifications include:

• Credit Score: 660+ (Check your score for free here)
• Debt-to-Income Ratio: 45% or less
• Existing Equity: 30% – 40%
• Type of Property: A single-family home or a property with 1-5+ units

Where to Find a Fix and Flip Investment Property Line of Credit

Investors can find a fix and flip investment property line of credit at their bank, credit union, or with an online lender. A portfolio LOC is a more specialized product and isn’t usually offered by banks. Instead, only certain financial establishments offer investment property lines of credit for a portfolio.

CoreVest does offer investment property LOCs for one or multiple assets. Their lines of credit start at $1,000,000 with competitive interest rates for prime borrowers. You can apply online and will then be assigned a personal representative to work with you.

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5. Fix and Flip Bridge Loans

A fix and flip bridge loan is a temporary loan used to cover the time between two real estate transactions. It’s typically used to purchase one property before selling another property. It allows you to purchase a fix and flip property without having a contingency to sell your other property first. Unlike a hard money loan, you can’t finance rehabs with fix and flip bridge loans.

Fix and Flip Bridge Loans at a Glance

Who Fix and Flip Bridge Loans Are Right For

A bridge loan can be right for a real estate investor who finds a great deal on a property that won’t be available by the time they have the cash or financing in place to purchase it. Investors typically use a bridge loan to purchase a property before refinancing it or flipping the property to pay off the bridge loan.

Fix and Flip Bridge Loan Rates, Terms & Qualifications

A bridge loan offers investors funding for flipping homes with higher rates, typically starting over six percent and short loan terms from a couple weeks to one year. Bridge loans generally have different qualifications based on the lender and these vary because it’s a specialty product. Typically lenders base their approval decision off of the deal and the borrower’s overall financial standing.

Fix and Flip Bridge Loan Rates & Terms

Bridge loans are short term, temporary loan products that provide interim or quick financing for a certain window of time. They are specialty loan products used to bridge the gap when selling one property and buying another, so their guidelines vary widely. Their rates are generally lower than hard money loans but higher than permanent bank loans.

Fix and flip bridge loans have the following rates and terms:

• Term: 2 weeks – 1 year
• Time to approval: 15+ days
• Rates: 6.2% – 9%
• Loan Origination Fees: 1% – 2%
• Closing costs: 1 – 5%

Fix and Flip Bridge Loan Qualifications

The qualifications for a bridge loan vary since they are such a specialty loan product. However, lenders generally look less at the borrower’s credit and financial history and more at the deal itself.

The qualifications of a bridge loan typically include:

• Financial Ability: To pay two mortgages
• Minimum Equity: 20%+ in existing property
• Exit Strategy: Made clear to lender, typically a sale or refinance

Where to Find Fix and Flip Bridge Loans

Bridge loans are a specialty loan product and aren’t as popular as other private loans, so they aren’t offered at all banks or credit unions. Instead, look for private lenders who offer nontraditional loan programs. They are sometimes referred to as cross collateralized loans by lenders, so ask your local mortgage lender if they offer bridge loans.

6. Permanent Bank Loan & Online Mortgage for Fix and Flip Funding

Permanent bank loans and online mortgages are characterized by 15- to 30-year terms and are used to purchase long-term, owner-occupied primary residences or non-owner-occupied investment properties in good condition. Therefore, permanent bank loans and online mortgages are not suitable for fix and flip investors since they typically purchase distressed properties.

However, there are a few permanent bank loans and online mortgages that benefit longer-term rehabbers. The FHA 203(k) loan, for example, allows for the owner-occupied purchase and renovations of a primary residence. The Fannie Mae HomeStyle loan, in addition to financing the owner-occupied purchase and renovations of a primary residence, also finances the purchase and renovations of a one-unit investment property.

Fix and Flip Permanent Loan & Online Mortgages at a Glance

Who Permanent Bank Loan & Online Mortgage Are Right For

Permanent bank loans and online mortgages are best used by long-term, buy and hold investors. However, fix and flippers might find them beneficial for a property that doesn’t need that much work or a property that they want to rehab, rent out and then flip later on.

Further, most of these permanent bank loans and online mortgages can’t finance properties in poor condition, with the exception of Homestyle Renovation Loans and 203(k) loans. Still, these aren’t right for short-term fix and flippers.

Fix and Flip Permanent Loan & Online Mortgage Rates, Terms & Qualifications

Permanent loans and online mortgages are typically conservative funding for flipping houses over a long period of time. They usually offer low rates starting at 4.6 percent and terms from 15 to 30 years. Their qualifications are based on the property and the borrower and are stricter than hard money loan qualifications.

Fix and Flip Permanent Bank Loan & Online Mortgage Rates & Terms

A permanent investment property loan and online mortgage typically have a term between 15 and 30 years. The approval time and time to funding is usually around 30 to 45 days, and the lender fees and interest rates are lower than some of the other fix and flip loans in this article.

Permanent bank loans and online mortgages typically have the following rates and terms:

• Term: 15 – 30 years
• Time to Funding: 30 – 45 days
• Rates: 4.5% – 6.6%
• Lender Fees: 0% – 1%
• Closing Costs: 2% – 5%
• Repayment: Monthly amortized payments

You can typically finance between 80 percent to 96.5 percent of a property’s purchase price, but the specific amount of financing is dependent on whether a lender is FHA-approved or not. FHA loans often only require 3.5 percent as a down payment. Fannie Mae loans typically require up to 20 percent as a down payment. Remember that permanent bank loans and online mortgages can only finance properties in good condition.

Fix and Flip Permanent Loan & Online Mortgage Qualifications

The qualifications of a permanent bank loan and online mortgage are very standard. This is because these long-term loan options are typically issued by FHA- or Fannie Mae-approved lenders, but not always. They can also be nonconforming portfolio loans.

Specifically, permanent bank loans and online mortgages require the following:

• Credit Score: 640+ (check your credit score for free here)
• Debt-to-Income Ratio: 45% or less

To verify income, lenders typically ask for two of your most recent pay stubs, a list of debts, as well as two to six months’ of bank statements. Further, permanent bank loans and online mortgages can only finance a property in good condition, limiting the effectiveness of the fix and flip loan.

Where to Find Permanent Bank Loan & Online Mortgages

There are many great long-term permanent mortgage providers. In fact, the U.S. Department of Housing has a list of both FHA-approved lenders and Fannie Mae-approved lenders. LendingTree is another option—it’s an online loan marketplace with one of the largest lender networks, so you can compare lender rates.

However, fix and flippers should instead rely on a lender like LendingHome. They’re a national hard money lender that offers short-term rehab loans with interest-only payments. Rates are competitive for prime borrowers and prequalification takes as little as three minutes.

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More Funding for Flipping Options

We discussed the six main types of fix and flip loans, but now let’s briefly examine some additional options of financing for flipping houses. These can be used in addition to fix and flip loans, or as an alternative to them. Things like cryptocurrency may be part of the future of fix and flip funding.

A few additional methods of financing for flipping houses include:

• Self-Directed Solo 401(k): This is a retirement incentive plan for self-employed individuals or small business owners without any full-time employees other than a spouse. You can invest in real estate with similar tax advantages to normal plans.
• Cryptocurrency: This is a digital currency that is traded online and operates independently of banks. Fix and flippers could use it to pay vendors or to fund the acquisition and rehab of their fix and flip projects. It’s a future opportunity that is starting to make traction in the real estate space.
• Business Credit Card: A business credit card gives you a revolving line of credit based on your credit score and income. It typically has a high interest rate, and gives you 30 days to make a minimum payment or pay off the balance. Fix and flippers can use it to purchase building supplies and appliances.
• Real Estate Crowdfunding: This alternative funding source pools investors’ money together to fund projects or portfolios of projects. You can invest in the debt or equity and receive a proportionate stake in the project. Investors would invest in crowdfunding as a way to get involved with real estate without being hands on.

You can use multiple sources of financing for flipping houses together. For example, a home improvement store credit card can be used with a small loan to fund the items needed to renovate a property, such as building materials and appliances. Ultimately, you need to think creatively to get fix and flip projects financed in some cases.

Tips on Funding for Flipping

Now that we have gone through six common types of fix and flip loans, we’re going to see what the pros have to say about funding for flipping. They offer some helpful insights into funding for flipping that will help you when you start your own house flipping business.

Below we share a few tips from the pros on financing for flipping houses:

“House flippers can and should factor the increased cost of financing into the specifics of the project—perhaps bid less for the home or increase the listing price when you sell the home to make up for the high financing cost associated with house flipping loans.” – Than Merrill, CEO, FortuneBuilders

“If you meet the hard money loan qualifications, make sure you have enough of a holding period, enough holding costs underwritten, and a healthy margin. With the interest rate being so high on this type of fix and flip funding, an extra week or two of holding costs can significantly impact your profit margins, so take this into account in your financial modeling.” – Veena Jetti, Founding Partner, Enzo Multifamily

“A bridge loan is ideal for an investor who wishes to purchase a new property and currently owns a property with a significant amount of equity. A bridge loan allows the investor to acquire the new property first and then later sell the previous piece of real estate.” – Jeffrey Hensel, Broker Associate at North Coast Financial

Bottom Line

Investors know that in order to make money flipping houses, they need the best fix and flip funding. Typically, there are six types of funding for flipping houses. The best option is generally a hard money loan because it can close fast, offers lenient qualifications and funds the acquisition and rehab of the fix and flip project.

For fix and flippers, we recommend checking out LendingHome. They’re a hard money lender that issues rehab loans up to 75 percent of a property’s after-repair-value (ARV). Rates are competitive for prime borrowers and monthly payments are interest-only. Prequalification takes a few minutes and funding can happen in as quickly as 15 days.

Visit LendingHome