A fix and flip loan pays for most of the purchase and all of the renovation, so your own cash goes further. This guide covers what the loan funds, how it is repaid, and what to watch for on a Washington flip.
What the loan covers
- Up to 90% of the purchase price
- Up to 100% of the rehab budget
- A total loan of up to 70 to 75% of the after-repair value
That leverage is for borrowers with a 720+ credit score. Programs go down to a 600 score with lower leverage and higher pricing.
How the rehab money is paid
Renovation funds are released in draws as work is completed. Draws are paid against the line-item budget you submit, so be specific. “Kitchen: new cabinets, stone countertops, tile backsplash” gets paid faster than “kitchen”.
No income verification
The loan is underwritten on the deal. There are no tax returns and no employment check. Investors with at least 5 flips in the last 2 years can also close without an inspection or appraisal.
How fast it closes
Most fix and flip loans close in 14 to 21 days. When title and insurance are ready, a loan can close in about 7 days. We can review a deal on the first call and issue a pre-qualification letter so you can make your offer.
Loan structure
- Interest-only payments
- Terms of 6 to 24 months
- No prepayment penalty
Flipping in Washington
- Older houses. In Seattle, Tacoma, Everett and Spokane, many flips are homes from the early 1900s. Budget for wiring, plumbing and foundation work, not only finishes.
- Sewer lines and oil tanks. Order a sewer scope, and check for a buried heating-oil tank on older homes around Puget Sound.
- Permits. Pull them. Buyers’ agents and inspectors here check, and unpermitted work can stall a sale.
- Excise tax. Washington charges the seller a real estate excise tax on the sale price. Put it in your exit costs.
- Seasons. Exterior work slows in the wet months west of the Cascades and in the snow east of them. Plan roofing, siding and site work around it.
Keeping the property instead
If the numbers favor holding, a DSCR rental loan pays off the fix and flip loan with long-term financing.
Read the full terms on fix and flip loans, or send us your deal.