Fix and Flip Financing

8 Replies

I am a newly licensed real estate agent and I have analyzed several deal. The strategy I am considering is buying a 80k house with a 20k rehab budget. Will a lender loan me 100k if the house is listed at 80k?

Congrats on being newly licensed Elandrous. Lenders are a dime a dozen, all with different criteria. Key questions are the ARV, your experience level (or the team you assemble to handle the rehab, and if you are bringing any $ to the table. Do you intend to flip or rent and refinance the property? Your exit is a consideration too. BE GREAT!

@Elandrous Peoples no. Let’s say banks won’t touch it because it needs rehab. Plus if it was fully rented and the value is $100k the max they would do is $80,000. 80% ltv.

If you needed money for purchase and rehab most lenders will do 70% of the arv. So let’s say The arv is $100k the max a lender will fund is $70,000.

@Elandrous Peoples

No most traditional lenders won’t fund the remodel or vacant homes they need work. I would suggest friends and family capital or a private investor.

Best of luck in all your endeavors.

Originally posted by @Elandrous Peoples :

@Joseph M'Mwirichia So if I present a report of the numbers and work that I will do I am more likely to get a loan that will include the rehab budget?

Not with a traditional bank. Banks are NOT in the business of owning properties. They don't want a half finished property that you said "you would remodel". Make sense? Like mentioned before I would network with local investors, family, friends, or private money lenders to achieve this goal.