Fix and Flip Loan Product

[Jalen DeVine]

How do you feel about this financing option? 

Fix and Flip Loan Product:

Financing covers acquisition and rehab 

Cash required: 10% of acquisition and rehab cost

Rates 8.5% to 9.5%

Term 6-12 months

LTV Required 70% as completed value

Fees 2.25%

So it would look something like this...

Purchase $300,000

Rehab $50,000

Loan Amount = $350,000

Cash Required = $35,000

ARV would need to be (350,000 / 70%) = $500,000

Fees = $7,875

6 Months of Interest at 9.5% = $16,625

[Robin Simon]

Not bad, but in this crazy and uncertain market its important to have max optionality and contingencies, especially in these types of investments where you can't be sure at all where the ARV is going to hit and an option to refi and hold (BRRRR) should be easy and on the table