What Makes a Good Fix & Flip Loan for a First Time Investor?

Choosing the right fix and flip loan is crucial for new investors. A good loan should offer:

• Quick Approval and Funding: Fast access to funds is essential to secure profitable deals in a competitive market. Many properties which are flipped are picked up off market and have closing deadlines with 2-4 weeks. A good Fix & Flip Lender can close in this timeframe.
• Flexible Terms: Loans with customizable terms that align with your project timeline and financial needs. Flexibility refers to loan amounts, rates, closing time, rehab budget, property types and more.
• High Leverage: The ability to finance a significant portion of the purchase and renovation costs, reducing the amount of out-of-pocket expenses. As a beginner, you should expect a loan amount of 75% to 80% plus 100% of rehab.
• Amazing Support and Transparency: Working with an experienced professional who frequently communicates with you about your loan and project is essential.

What Costs Are Associated With Your Fix and Flip Project and Loan?

Understanding the costs involved in a fix and flip project is critical to ensure profitability. Key costs include:

• Purchase Price: The cost of acquiring the property, typically calculated using the 75% Rule (75% of the After Repair Value minus repair costs).
• Renovation Costs: Expenses related to rehabbing the property, including materials, labor, and contractor fees. Make sure to include a 5% contingency for unexpected costs.
• Loan Costs:
  • Interest Rates: Most Fix & Flip projects for beginners take 3-6  months to complete. Make sure you can cover 3-6 months of interest payments before you sell the house for a profit.
  • Points: Fees paid upfront to secure the loan, usually 1.5%-2.5% of the loan amount.
  • Down Payment: With a 75%-80% LTV loan, your down payment will be 20%-25%.
• Holding Costs: Expenses incurred while holding the property, such as property taxes, insurance, utilities, and maintenance.
• Selling Costs: Costs associated with selling the property, including real estate agent commissions, closing costs, and any staging or marketing expenses (Assume 5%).

Fund Your Project With Ridge Street Capital

Ridge Street Capital offers tailored fix and flip loan solutions designed to meet the unique needs of first-time investors

Our loan programs provide:

• High Leverage: Up to 80% of the purchase price and 100% of the rehab costs for first time investors.
• Competitive Rates: Interest rates starting at 10.25%.
• Flexible Terms: Loan terms ranging from 6 to 18 months.
• Personalized Support: industry leading support and transparency throughout the lending process.

Request a Term Sheet or Get Pre-Approved.

What is the Fix and Flip Loan Process for First-Time Flippers?

Navigating the fix and flip loan process with Ridge Street Capital is straightforward:

1. Apply Online: Fill out a short form with info about your project and the requested funding amount. If you’re just looking to get pre-approved so that you can search for your next project, get pre-approved here. (2 mins)
2. Receive your Term Sheet: Once we have your completed application, we’ll email you the term sheet and give you a call to provide confirmation. (2 hours)
3. Submit Documents: Ridge Street has low-document programs with no income verification. (1-7 days)
4. Appraisal: Once you've submitted your docs an appraisal will be ordered and completed In 2-7 days.
5. Loan Closing: Once we have your docs, we'll schedule your closing as soon as the next day.

About Ridge Street Capital

Ridge Street Capital is a relationship-based investment property lender dedicated to helping first-time fix and flip investors succeed. Our loan programs are designed to provide the funding and support you need to maximize your investment returns. With a focus on flexibility, competitive rates, and personalized service, Ridge Street Capital is the top fix and flip lender for first time investors.

Request a Term Sheet or Get Pre-Approved