Fix & Flip Loans Guides

Purchase and rehab financing with draws, after-repair value, and the math investor lenders run.

A fix and flip loan finances the purchase of a property and the cost of renovating it, repaid when the property is sold or refinanced. Lenders commonly fund part of the purchase price at closing and release the rehab budget in draws after inspections confirm the work, sizing the loan to both the cost of the project and the after-repair value. Terms are short and the property is the primary collateral.

Lenders weigh the investor's track record, liquidity for the down payment, carrying costs and overruns, the scope of work and the budget, and the realism of the after-repair value. First-time investors can qualify with stronger liquidity and a clear plan. These guides cover draws, ARV, loan-to-cost, costs and how to get a first deal funded.

Guides

Hard Money Loan Costs Explained: Points, Interest, Draws and Extensions — Hard money loan costs come in layers: origination points, interest-only payments, rehab holdbacks and draw fees, extension and exit fees. Here is how each is structured, how to compare two term sheets, and what a cheap-looking loan can hide.
Getting Your First Fix-and-Flip Loan With No Track Record — Lenders will fund a first fix and flip loan without a track record, but they replace experience with other evidence: a credible contractor, a line-item scope and budget, a defensible ARV, verified liquidity for the down payment and carry, and a written exit.
Financing Your First Investment Property: A Playbook — A step-by-step playbook for financing your first investment property: pick your strategy, get pre-approved, budget the real cash-to-close, and avoid the mistakes that stall first deals.
Preparing for an Investment Property Appraisal: A Checklist — A practical checklist for investment property appraisals: rent documentation, the 1007 rent schedule, ARV scope of work for rehabs, and what to do if the value comes in low.
Hard Money vs. Bank vs. DSCR: Which Loan Fits Your Deal? — Hard money, bank loans, and DSCR loans each fit a different stage of an investment property deal. Compare speed, cost, and requirements to pick the right one.
How Fix-and-Flip Loan Draws Work, From First to Final — Fix-and-flip loan draws reimburse completed rehab work in stages. See how the draw schedule, inspections, and funding timing work, so cash flow never stalls your project.
Financing the BRRRR Method: Every Loan at Every Stage — How to finance a BRRRR deal in two loans: short-term acquisition and rehab money, then the DSCR cash-out refinance that returns your capital.
Why Investor Loans Fall Through — and How to Prevent It — A brokerage breaks down why investor loans really fall through - low appraisals, insurance shocks, credit moves - and how to prevent each one before closing.
LTV, LTC, and ARV: The Math Behind Investor Loans — LTV, LTC, and ARV are three different lending caps — learn how they combine, why the lowest one wins, and how to calculate your real loan amount.

Frequently asked questions

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

Yes, many lenders fund first-time investors, often with a larger down payment, lower leverage, more liquidity, or a contractor and plan that show the project is manageable. A partner with experience or a smaller first project can also help. Terms usually improve as completed projects build a track record.

How do rehab draws work?

The lender holds the renovation budget and releases it in stages. The investor completes and pays for work, requests a draw, an inspector confirms the progress, and the lender reimburses that portion. Investors need cash to fund work between draws, so draw timing belongs in the budget.

What is ARV and why does it matter?

ARV is the after-repair value, the estimated market value once the renovation is complete. Lenders cap the loan relative to ARV as well as cost, so an optimistic ARV reduces the loan the lender will make. An appraisal or broker opinion supported by comparable sales sets it.

How MercFinancial places it

Real Estate Funding — DSCR, fix and flip, construction, bridge and portfolio loans for investors.