What Is a Fix and Flip Loan? 2026 Guide

We’ve flipped over 100 houses in the Omaha market through Beard Bros Build Co. since 2019 — and financed most of them with exactly this product. This is the guide we wish we’d had on flip number one.

How a Fix and Flip Loan Is Structured

• Purchase funding: the lender covers a percentage of the purchase price; you bring the down payment.
• Rehab funding: renovation costs are held in escrow and released in draws as work is completed and inspected. Many programs fund up to 100% of the rehab budget.
• ARV cap: total loan is capped at a percentage of the after-repair value — the number your comps have to support.
• Interest-only payments during the project, with the full balance due at sale or refinance.

What Lenders Underwrite

Four things decide your terms: your experience (verified completed flips move you up pricing tiers), the deal’s ARV and rehab budget (supported by comps and a scope of work), your liquidity to cover the down payment, carry costs, and overruns, and your credit. First-timers can absolutely get funded — expect lower leverage and a closer look at the scope of work.

The Draw Process, Honestly

Draws are where new flippers get squeezed. You pay contractors, then the lender reimburses after inspection — meaning you float each phase of work. Budget working capital for that gap. Pro move from our own projects: front-load your draw schedule with the highest-cost line items you’ll complete earliest, and photograph everything.

What Makes a Deal Fundable in 2026

Real comps, a scope of work a third party can follow, and margin that survives surprises. If your numbers only work when everything goes perfectly, the deal doesn’t work — that’s not lender conservatism, that’s 100 flips of experience talking. Buy the discount, don’t finance your way into one.

Frequently Asked Questions