Fix and flip loans give investors a way to purchase a property, fund the renovation, and resell it without tying up personal savings or waiting on a slow conventional mortgage. This type of short term financing is built around the project itself, which allows investors to move quickly on a deal and cover renovation costs as the work progresses.
Texas has become one of the more active states for property investors, thanks to a large supply of older homes suited for renovation and a range of price points across its major metro areas. A financing option that closes quickly and scales with different project sizes fits naturally with how investors operate in this market.
Understanding Fix and Flip Financing
A fix and flip loan is a short term loan secured by the property being purchased and renovated. Approval is based mainly on the deal itself, meaning the purchase price, the renovation plan, and the projected value of the home once repairs are complete. This differs from a conventional mortgage, which relies heavily on the borrower’s personal income history and long term repayment profile.
Since the loan is tied to the property and project, closing tends to move faster than traditional financing. Terms usually run between six and eighteen months, giving investors enough runway to complete renovations and either sell the property or move into longer term financing.
Who Uses Fix and Flip Loans
This type of financing suits a range of investors working in the Texas market.
- New investors purchasing their first renovation property
- Experienced flippers managing several projects at the same time
- Contractors who buy properties directly instead of only performing renovation work
- Investors who prefer to preserve personal cash for other opportunities
- Buyers targeting older or distressed homes that need significant updates
Self employed borrowers and those without traditional pay stubs often qualify more easily under this type of financing, since the property and project plan carry more weight than personal income documentation.
Why Choose Loankea as Your Trusted Fix and Flip Lender?
Loankea delivers comprehensive lending solutions with competitive advantages:
- Competitive interest rates and low closing costs
- Access to 150 mortgage banking institutions
- Fast approvals within 7-15 business days
- Custom mortgage solutions
- Multiple property type financing options
- Various loan programs including Full Doc, No Doc, and First-Time homebuyer options
Investment Property Financing Solutions
New Purchase Financing
- Rapid closing capability within 7 days
- Competitive positioning against cash buyers
- 100% rehabilitation cost coverage
- Complete purchase-to-renovation funding
Delayed Purchase Refinancing
- Cash-out options within 6 months of property acquisition
- Ideal for recovering initial investment
- Flexible terms for renovation funding
Seasoned Property Financing
- Available for properties owned 6+ months
- Extended project completion timelines
- Structured for optimal investment returns
We provide financing for various property types including single-family residences, manufactured homes, multi-unit properties (2-4 units), condominiums, and Planned Unit Developments (PUDs).
Step by Step Funding Process
Fix and flip financing follows a structure built around the renovation timeline instead of a standard thirty year mortgage.
- The lender evaluates the purchase price, renovation budget, and projected after repair value.
- Funds are approved to cover both the purchase and a portion of renovation costs.
- Renovation funds are released in stages, commonly at the 25, 50, 75, and 100 percent completion marks, after each stage passes a property inspection.
- The loan is repaid once the property sells or once the investor refinances into a longer term loan.
This staged release protects the lender while giving the investor predictable access to funds as renovation milestones are reached.
What Lenders Look For
Every project is reviewed individually, though most fix and flip financing follows a similar set of guidelines.
- A signed purchase contract or current proof of ownership
- A renovation budget with a realistic scope and timeline
- An after repair value supported by comparable properties in the area
- Reasonable investor experience or a clear plan for newer buyers
- Enough reserves to cover holding costs while the renovation is underway
Lenders generally focus first on the strength of the deal itself, then confirm the borrower has the resources and plan to complete the project on schedule.
Credit Score and Down Payment Requirements
Because the loan is secured by the property, requirements are less demanding than a conventional mortgage, though a few borrower level numbers still factor into approval.
- Minimum credit score of 620 for most programs, with stronger pricing available above 680
- Down payment or equity contribution as low as 10 percent of the purchase price for experienced investors, and typically 15 to 20 percent for newer investors
- Cash reserves equal to roughly 3 to 6 months of holding costs, including insurance and property taxes
- Higher leverage available to investors who have completed several prior renovation projects, with lower leverage for first time borrowers
A lower credit score does not automatically rule out an application. Loankea also weighs the deal itself, including the purchase price, renovation plan, and after repair value, alongside the borrower level numbers above.
Typical Loan Terms
Fix and flip financing is generally structured around the purchase price, the renovation budget, and the after repair value. The table below outlines a typical range.
| Loan Feature | Typical Range |
|---|---|
| Loan amount | $75,000 to $3,000,000 |
| Purchase price financed | Up to 90% |
| Renovation costs financed | Up to 100% |
| Maximum loan to ARV | Around 70% to 75% |
| Interest rate | Starting around 9.9% |
| Origination points | 1.5 to 3 points |
| Payment structure | Interest only during the term |
| Prepayment penalty | None on most programs |
| Loan term | 6 to 18 months |
| Closing timeline | As fast as 5 to 7 business days |
For example, an investor purchases a property in Texas for $350,000 and budgets $80,000 for renovations. The completed home is projected to be worth $520,000 after repairs. A lender financing 85% of the purchase price and 100% of the renovation budget would provide close to $377,500 in total funding, which falls within a typical loan to ARV range. Because payments are interest only, the investor’s monthly cost during renovation is based on the outstanding balance rather than a fully amortizing payment, which keeps holding costs more predictable. The investor covers the remaining purchase amount along with holding costs such as insurance, property taxes, and utilities during the renovation period.
Exact terms depend on the property, the borrower’s experience, and the specific project, so investors should confirm final figures directly with Loankea before setting a budget.
Advantages for Investors
- Faster closing than a conventional mortgage, useful in a competitive market
- Approval based on the property and project instead of personal income alone
- Renovation costs built into the loan instead of funded entirely out of pocket
- Interest only payments that keep monthly costs predictable during the renovation
- No prepayment penalty on most programs, so an early sale does not add extra cost
- Ability to take on multiple projects instead of committing all personal cash to one deal
These factors make fix and flip loans a practical way for investors to grow a renovation business without overextending their own capital.
Texas Specific Factors to Know
A few state specific details are worth planning for before starting a renovation project in Texas.
Texas does not require a general contractor license at the state level, though trades such as electrical, plumbing, and HVAC work do require state licensing, and permitting requirements vary widely between incorporated cities and unincorporated county areas. Much of Texas sits on expansive clay soil, which can lead to foundation movement in older homes, so a foundation inspection before finalizing a renovation budget is a reasonable precaution. In coastal and flood prone areas, elevation certificates and wind resistant materials may affect both renovation costs and insurance.
Closings in Texas are typically handled through title companies rather than closing attorneys, which is standard across most of the state and generally keeps the closing process straightforward. Texas also uses a non judicial foreclosure process, a legal framework that differs from many other states and is one reason lenders are often comfortable extending competitive terms on Texas property. Texas has no state income tax, a factor that continues to draw both residents and property investors to the state. Property taxes, however, are among the higher rates in the country, which is worth factoring into holding costs during the renovation period.
- Identify the property and gather the purchase contract or deed.
- Put together a renovation budget and detailed scope of work.
- Submit an application to Loankea along with supporting documentation, such as proof of funds and a contractor estimate.
- Work with an underwriter to finalize the loan amount and terms.
- Close on the loan and begin renovation according to the draw schedule.
Loankea works directly with investors through each of these steps, helping structure the loan around the specific property and project timeline.
What We Offer
Loankea offers diverse fix & flip loan solutions crafted exclusively for property investors looking to venture into house flipping. Each lending option is customized to align with investors’ specific requirements. It helps investors achieve their monetary objectives with flexible terms and reliable support throughout the process.
Our Best Terms and Conditions:
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