Cash to Close · 9 min read
How Much Cash Do You Really Need to Buy a Home?
A plain-English breakdown of down payments, closing costs, reserves, and the smaller line items most first-time buyers don't see coming.
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Investment & Business Financing · Fix and Flip
Short-term financing for investors who buy, renovate, and resell.
A fix and flip loan is built around the numbers of the project, not the timeline of a traditional mortgage. It is purpose-built financing designed to help investors acquire a property, fund the renovation, and exit on sale.
Corie Adams · Producing Branch Manager · NMLS #1875205
Who this is for
Whether this fits the plan you have.
This financing tends to fit investors with a clear scope of work and a realistic budget, whether it is their first project or their twentieth.
Active flippers
You buy, renovate, and resell as a repeatable strategy, and you need financing that matches a 6 to 18 month project timeline instead of a 30-year mortgage.
BRRRR investors
You plan to buy, rehab, rent, and refinance. The fix and flip loan covers the entry, and a long-term loan like DSCR covers the hold once the property is stabilized.
Contractors turned investors
You bring the renovation expertise in-house, and you need a lender that funds the rehab budget in draws as the work is completed.
First-time flippers with a solid plan
Program guidelines vary, and experience often affects leverage and pricing, but a clear scope of work and a realistic budget can carry a first project.
Investors buying below market
Distressed or dated properties bought below market value benefit most from financing sized against the after-repair value rather than the purchase price alone.
How it works
The path, step by step.
The structure is different from a standard mortgage, and it is designed to move at the pace of a renovation project.
We review the deal and the scope of work
Purchase price, renovation budget, and timeline all factor into whether the deal pencils before financing is structured.
We size the loan against the after-repair value
Financing often reflects both the purchase price and the expected value once renovations are complete, which affects how much of the rehab budget is covered.
Draws fund the renovation as work is completed
Rather than releasing the rehab budget upfront, funds are typically disbursed in draws tied to completed and inspected work.
You execute the project on a short term
Terms typically run 6 to 18 months, matching the pace most renovation and resale projects need.
You exit through sale or refinance
The loan is repaid when the property sells, or refinanced into long-term financing such as a DSCR loan if you decide to hold it as a rental instead.
Start with a real number, not an estimate.
A pre-approval reviews your income, assets, and credit so you know the price range you can actually work with before you tour a home or sign a builder contract.
Requirements at a glance
What underwriting looks at.
Every lender sets its own thresholds. These are typical expectations to help you gauge whether a deal is likely to work.
- Loan basis
- Purchase price plus a rehab budget, sized in part against the after-repair value
- Draws
- Rehab funds released as work is completed and inspected
- Term
- Typically 6 to 18 months
- Experience
- Not required for a first project, though it can affect leverage and pricing
- Exit strategy
- A defined plan to sell or refinance before the loan term ends
- Scope of work
- A clear, realistic renovation budget and timeline
Guidelines vary by lender and change over time. Nothing here is a commitment to lend or an approval of credit.
Costs and assumptions
What it costs, and what we assumed.
The economics of a flip live and die on the numbers. These are the categories worth stress-testing before you commit to a purchase.
Purchase and rehab financing
The loan can cover both the purchase and the renovation budget, which keeps more of your own cash available for the next deal.
Short-term financing cost
Short terms and draw-based funding typically carry a higher cost than a 30-year mortgage, which is the trade-off for speed and flexibility.
Exit costs
Selling or refinancing at the end of the term brings its own closing costs, which should be built into your project math from the start.
Common misconceptions
What people get told, and what is actually true.
Often heard
You need years of flipping experience to qualify.
In practice
First-time flippers can qualify too. Program guidelines vary, and experience often affects leverage and pricing rather than eligibility itself.
Often heard
The rehab budget is handed over all at once.
In practice
Rehab funds are typically released in draws as work is completed and inspected, which keeps the financing tied to real progress.
Often heard
The loan is only sized on the purchase price.
In practice
Financing is often sized against both the purchase price and the after-repair value, which can unlock more leverage on the rehab budget.
Often heard
You must sell the property to repay the loan.
In practice
Selling is one exit. Refinancing into a longer-term loan, such as a DSCR loan, is another option if you decide to hold the property as a rental.
Questions
Asked at the kitchen table.
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