All You Need to Know About Fix and Flip Loans

This post was originally published on 3/5/18 and updated on 7/8/19.

Fix and flip loans introduce an opportunity to an investor to access real estate and to attain the capital they need to develop and renovate the property so that it can be sold at a profit.  The cost to fix and flip a property is usually a barrier for many individuals but a fix and flip loan eliminates that barrier and provides an easy way to fund a project. 

Why Choose Fix And Flips Loans?

Typically, those who choose to purchase a home, renovate it and resell it for a profit need additional funds to complete or even start a fix and flip project.  Traditional lenders, such as banks generally do not provide fix and flip loans. Private lending is another way to go about securing this type of loan. A benefit of going the private lending route is that loans are approved quickly. Some companies give a “yes” or “no” answer the same day. This allows borrowers to focus on the main project which is fixing up a property!   

What Properties Can Be Funded Using Fix and Flip Loans?

A variety of properties can be funded with a fix and flip loan.  Some of these properties include multi-family residences, single family units, commercial buildings, and other types of property. Being financially versatile allows nearly unlimited access to funds for fix and flip projects, giving you an array of properties to choose from.

What are Common Mistakes Made in Fix and Flip Loans?

The biggest mistake made in fix and flip loans is when applicants underestimate the amount it will take to complete the project  and don’t have enough funds to cover those unforeseen repairs. Conversely, some flippers overestimate the post-renovation value. This happens when flippers add premium features to the home that don’t fit the neighborhood. This deters buyers from paying the additional premium. Another common mistake is when you work with inexperienced contractors and underestimate the time to complete the project.

Although HGTV shows like Flip or Flop and Master of Flip make fixing and flipping homes in California look easy, we understand that the construction and funding process take longer than an hour-long episode. Evaluate the pros and cons and examine the key factors which includes finding a house at a low enough price, obtaining an experienced contractor, and securing a fix and flip loan. At the end of the day you want to be selling at a price that will not only cover expenses but will provide enough profit to reward you for the time and effort invested.

 

What JCAP Private Lending Considers in Fix and Flip Loans?

There are several considerations that JCAP Private Lending consider when determining whether we can fund you for a Fix and Flip loan. 

• The experience the applicant has in the real estate regarding these projects.

• The amount of capital available.

• The purchase price of the property. 

• The estimated value of property after repair.

• The estimated cost of renovation. 

 

Why Choose JCAP Private Lending for a Fix and Flip Loan?

JCAP Private Lending is committed to funding your fix and flip loan in as little as one week . Unlike traditional banks, we take into account the ARV, or after repair value, of a property. We won’t make you jump through hoops for rehab, ground-up construction, mid-construction or fix and flip property funding. Instead, we offer same-day approval and a finance term of 3-36 months, depending on the specifics of your construction project. That way you can get to work ASAP on your investment property.

Give us a call or email us and we will close quickly on your fix and flip financing. If your fix and flip loan has been denied by a bank, we will take care of you regardless of your financial situation.

 

About JCAP Private Lending

JCAP Private Lending is a Direct Lender who closes and services Investor Funded Short-Term Real Estate Loans.  Our experienced team has been providing quality mortgage services for over 30 years. JCAP Private Lending is an Asset Based Lender who steps in to quickly solve a short-term financial need secured by Real Estate. JCAP has an innovative approach to lending: focusing on speed, simplicity, and safety for borrowers and investors. JCAP’s operating philosophy is simple –  “We Care & We Serve”

Bob Eakin
CEO at JCAP Private Lending
 3151 Airway Ave Suite Q3 Costa Mesa, CA 92626                       
Office (949) 622-6199        Website https://jcap.net/
Investor Funded Short-Term Real Estate Loans

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