DSCRHome › Fix & flip loans
Fix and flip loans
A fix and flip loan is short-term money that covers both the purchase and the rehab of a property you plan to resell. It is sized off the after-repair value (ARV), and 2026 rate bands run about 10.5% to 13.5% plus 1 to 3 points.
Get matched with DSCR & hard-money lenders
Compare real rate quotes from investor-friendly lenders for your next rental or flip. Free, no obligation.
How a fix-and-flip loan is structured
1 · Purchase plus rehab
The lender funds up to about 90% of the purchase and most of the rehab, released in draws as work passes inspection.
2 · Sized off ARV
The total loan is capped near 70% of the after-repair value, the finished resale value rather than today’s price.
3 · Repay on resale
You pay interest only during the 6 to 18 month term, then retire the loan when the renovated home sells.
The flip math (the 70% rule)
The 70% rule reserves roughly 30% of ARV for profit, carrying costs, and fees. Worked example: a property with a $300,000 ARV and $50,000 of rehab pencils to a max offer of about $160,000 (0.70 × $300,000 = $210,000, minus $50,000). If the seller wants more than that, the margin is probably too thin to clear interest, points, and closing.
Thinking about holding instead of selling? Our cap rate calculator and the 1% rule sanity-check the buy-and-hold version of the same property when the flip margin looks tight.
Frequently asked
What is a fix and flip loan?
A short-term loan, usually 6 to 18 months, that funds both the purchase of a property and its renovation, repaid when you sell the finished home. It is sized off the after-repair value (ARV), not today’s price.
What are fix and flip loan rates?
Illustrative 2026 bands run about 10.5% to 13.5% interest plus 1 to 3 points. Lenders commonly fund 70 to 90% of purchase and most of the rehab, with the total capped near 70% of ARV.
How much can I borrow for a flip?
Most lenders fund up to about 90% of purchase and most of the rehab, as long as the total loan stays near 70% of ARV. The deal also has to show a profit margin after every cost, often in the 20 to 30% range.
Do I need experience to get a flip loan?
First-time flippers can qualify, but a track record earns better terms. Lenders usually want a scope of work, contractor bids, and comparable sales to back the ARV.
Related
Planning to keep the property instead of selling? A DSCR loan is the usual exit, and our market ranking scores 18 metros on buy-and-hold cash flow. Note that at today’s roughly 6.8% 30-year rate, most of those metros land below the 1.20 DSCR most lenders require, so the ranking shows which markets come closest, not which ones are easy.