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A fix and flip loan is short-term financing for an investment property that needs renovation before it is sold or refinanced.
At Ziffy Mortgage, eligible fix and flip loans can finance the acquisition and renovation stage of an investment, subject to the applicable LTC and after-repair value limits.
Fix and flip financing generally fits the acquisition and renovation stage of an investment. A DSCR loan fits a different stage: a stabilized rental property whose income can support the mortgage.
Investors following a BRRRR or fix-to-rent strategy may use both, starting with short-term rehab financing and refinancing into a DSCR loan once the property is ready to hold.
Ziffy Mortgage offers fix and flip loans with terms from 6 to 24 months, a 650 minimum credit score, up to 92% LTC, up to 100% eligible rehab financing, and a 75% ARV cap.
Fix and flip loan rates are deal-specific. Credit, leverage, ARV, experience, property location, rehab scope, and the requested term can all affect pricing.
The interest rate alone does not tell you what a flip loan will cost. Origination points, draw charges, extension provisions, and the number of months you carry the loan can materially change the final financing expense.
DSCR loans are long-term rental loans. Ziffy qualifies these loans primarily using gross monthly rent compared with PITIA rather than the borrower’s personal income.
Investors who renovate a property and decide to keep it can potentially refinance their fix and flip loan into DSCR financing after the property is stabilized.
House flipping remains a meaningful part of the US housing market, although current margins leave less room for financing mistakes. According to ATTOM’s Q1 2026 Home Flipping Report, 64,348 single-family homes and condos were flipped in the first quarter of 2026, representing 8% of all home sales. Typical gross flipping returns were 25.4%, while the typical flip took 165 days from purchase to resale. ATTOM’s gross-return calculation does not deduct renovation and other project expenses.
That 165-day timeline helps put financing costs in perspective. A short-term loan may look affordable at closing, but an extra month of construction, permitting, listing time, or buyer financing means another month of carrying the debt along with taxes, insurance, utilities, and other property costs.
Table of Contents
What Is a Fix and Flip Loan and How Does It Work?
A fix and flip loan finances an investment property that an investor intends to purchase, renovate, and then sell or refinance.
Unlike permanent rental financing, the lender is underwriting a property that is still being improved. The file is therefore built around the purchase price, current condition, renovation plan, project cost, borrower liquidity, ARV, and proposed exit.
At Ziffy, fix and flip borrowers are not required to provide W-2s, pay stubs, personal tax returns, personal income verification, employment verification, or meet a minimum DTI requirement. The program is designed around the investment project and its financing structure.
That structure can work for homes that require renovations before resale as well as properties an investor eventually wants to convert into long-term rentals.
What Are Fix and Flip Loan Rates in 2026?
Fix and flip loan pricing can vary significantly from one file to another. Lenders may consider the borrower’s credit profile and experience, requested leverage, loan size, property location, ARV, renovation complexity, and expected loan term.
Ziffy Mortgage provides a deal-specific rate quote rather than presenting one interest rate as the price for every fix and flip borrower.
For investors comparing loans, the quoted rate should be the beginning of the comparison rather than the end of it. Review:
- the note rate and payment structure
- origination points and lender fees
- rehab draw and inspection charges
- how and when interest starts accruing on rehab funds
- loan-extension terms and fees
- minimum-interest or prepayment provisions, if applicable
- what happens to the rate if the project runs past maturity
Fix and flip financing is generally used for investment rather than owner-occupied purposes. Under 12 CFR §1026.3, an extension of credit primarily for a business, commercial, or agricultural purpose is exempt from Regulation Z.
That does not mean every fix and flip loan should automatically be treated the same way. The purpose and structure of the particular transaction determine how the rules apply. For an investor comparing business-purpose financing, reviewing the actual loan documents, fees, maturity provisions, and extension terms is therefore important.
A lower headline rate does not necessarily produce the lowest total borrowing cost if another loan has cheaper fees or more forgiving extension terms.
What Are Ziffy Mortgage’s Fix and Flip Loan Terms?
Here are the current terms for Ziffy’s fix and flip loan program:
These limits work together. Up to 92% LTC does not automatically mean that 92% of every project will be financed. Likewise, financing up to 100% of eligible rehab costs does not override the ARV cap.
For a detailed breakdown of credit, liquidity, contractor documentation, down payment, rehab draws, and first-time-investor qualification, see our complete guide to fix and flip loan requirements.
How Do LTC and ARV Determine a Fix and Flip Loan Amount?
Fix and flip financing commonly relies on two measurements: loan-to-cost (LTC) and after-repair value (ARV). LTC measures the loan relative to the cost of acquiring and renovating the property:
LTC = Loan Amount ÷ Total Project Cost
Total project cost generally includes the purchase price plus the approved renovation budget. ARV estimates what the property should be worth after the planned improvements are finished.
Ziffy Mortgage allows eligible loans of up to 92% LTC, while the total loan is also capped at 75% of ARV. Both constraints apply, so the lower permitted loan amount controls the structure.
A documented Ziffy scenario illustrates the difference. The property had a $200,000 purchase price, an $80,000 renovation budget, and a projected $380,000 ARV. Total project cost was $280,000.
At 92% LTC, the cost-based maximum was $257,600. At 75% ARV, the value-based maximum was $285,000. Since the LTC calculation produced the lower number, $257,600 was the controlling amount.
This is why an aggressive resale estimate cannot rescue a purchase price or rehab budget that does not work. Investors need sold comparable properties and a defensible renovation plan to support the ARV. Our guide to ARV in real estateexplains the valuation side in more detail.
How Do Rehab Draws Work on a Fix and Flip Loan?
Rehab financing is typically released as work progresses rather than being handed to the borrower as one unrestricted payment at closing. The lender reviews the scope of work and approved renovation budget. As agreed stages of the project are completed, the work is verified and eligible funds are released through draws.
That means investors need to think about liquidity even when their loan provides up to 100% rehab financing. Contractors may require deposits, materials may need to be purchased before a reimbursement draw is released, and the property still has carrying costs during construction.
The files that move fastest are not the ones submitted the earliest. They are the ones submitted cleanest. If we have strong comps, a real contractor bid, a clear scope, and a believable exit, we can move quickly. If every document creates another question, the timeline stretches.
A detailed contractor bid, realistic scope, ARV support, available liquidity, and a clear exit give underwriting fewer unresolved questions.
Fix and Flip Loan vs DSCR Loan: Which One Fits the Property?
Fix and flip loans and DSCR loans are both investment-property financing, but they solve different problems.
With a DSCR loan, qualification centers on rental income rather than personal income or DTI.
At Ziffy, DSCR is calculated as:
DSCR = Gross Monthly Rent ÷ PITIA
PITIA includes principal, interest, taxes, insurance, and association dues when applicable. Ziffy’s current DSCR loan requirements include a 620 minimum credit score, up to 85% LTV for eligible purchases, up to 80% for rate-and-term refinances, up to 75% for cash-out refinances, $100,000 to $10 million loan amounts, and two months of cash reserves. A DSCR of 1.0 or higher generally receives the best terms, while eligible properties below 1.0 can have a path through No-Ratio DSCR financing.
Most investors ask this as an either-or question, but the stronger answer is usually about timing. Hard money can get you into a property that is not financeable yet. DSCR can keep you in the property once it is stabilized and producing rent.
A property that still needs substantial work may need fix and flip financing today and DSCR financing later.
Can You Refinance a Fix and Flip Loan Into a DSCR Loan?
Yes. An investor who finishes the renovation and decides to keep the property can potentially replace the short-term loan with long-term DSCR financing.
This financing sequence is particularly relevant to a BRRRR strategy: acquire the property, complete the rehab, place it into rental condition, and then refinance once the asset can support permanent financing. Ziffy also discusses this transition in our hard money vs DSCR loan comparison.
The refinance should be considered before the flip loan closes. An investor planning to hold should estimate the likely post-renovation value, supportable market rent, PITIA, expected DSCR, and potential refinance proceeds at the proposed LTV.
A project that needs an unusually high appraisal or above-market rent to repay the short-term debt may have an exit problem before construction even begins.
How Long Should You Budget for a Fix and Flip?
Ziffy’s fix and flip loan terms range from 6 to 24 months, but the loan maturity is not the same thing as a realistic project schedule. ATTOM reported that the typical US home flipped in Q1 2026 took 165 days, up from 160 days the previous quarter. That works out to roughly five and a half months between purchase and resale.
Construction occupies only part of that period. Investors may also need time for permits, contractor scheduling, inspections, appraisal, marketing, buyer negotiations, and the purchaser’s closing process.
This is why holding time belongs in the financing analysis. If a project expected to exit in five months takes seven, the investor has added two months of loan carry and property expenses.
You can use the Ziffy Fix & Flip Calculator to run purchase price, renovation cost, financing expenses, holding costs, resale assumptions, and projected profit together. Run the expected timeline first, then stress-test a slower exit before deciding how much margin the project actually has.
What Costs Should You Compare Beyond the Fix and Flip Loan Rate?
The cheapest rate is not automatically the cheapest loan.
Suppose one lender charges a slightly lower note rate but higher origination fees, expensive rehab draws, or a large extension fee. Another lender may quote a higher rate but produce a lower total financing bill for a six-month project.
The comparison should therefore be made in dollars through the expected payoff date.
Investors should also keep financing costs separate from the rest of the project budget. Property taxes, insurance, utilities, HOA dues, permits, contractor overruns, maintenance, selling expenses, and closing costs can continue accumulating while the property is held.
This becomes more important when gross flip margins are tight. ATTOM’s Q1 2026 figures show a typical gross profit of $66,000 and a 25.4% gross return, but those figures are calculated before rehab and other project expenses are deducted.
A deal should still make sense after realistic financing, renovation, carrying, and disposition costs are included.
Can First-Time Investors Get a Fix and Flip Loan?
Yes. Ziffy Mortgage does not require previous flip experience for its fix and flip program.
First-time investors should still expect the project itself to receive close attention. Underwriting needs a clear scope of work, contractor bid, ARV support, liquidity, project timeline, and believable exit.
Ziffy’s current requirements guide notes that first-time flippers should generally plan closer to a 30% down payment rather than assuming they will receive the most aggressive leverage available. Experienced borrowers with stronger files may qualify closer to 25%.
For investors preparing their first project, our guide on how to flip a house covers the acquisition, renovation, resale, and deal-analysis side before financing is added.
Can the FHA 90-Day Flip Rule Affect Your Resale?
It can affect the financing options available to some buyers.
Under 24 CFR §203.37a, a property generally is not eligible for an FHA-insured mortgage when the resale occurs 90 days or less after the seller acquired it. For resales from 91 through 180 days, the property is generally eligible, although additional documentation can be required in certain circumstances.
The rule does not prohibit an investor from selling the property within 90 days. It affects FHA mortgage eligibility for the buyer.
A flipper expecting a rapid resale should therefore think beyond ARV and consider who is likely to buy the finished property and how that buyer may finance the purchase.
Fix and Flip or DSCR: Which Financing Should You Choose?
- Use a fix and flip loan while the value-creation work still needs to happen. The property requires renovation, the financing is temporary, and your exit is a sale or refinance.
- Use a DSCR loan when you have a rental property that is ready to hold and its rental income can be evaluated against the mortgage payment.
For some investors, there is no need to choose only one. A distressed house can begin as a fix and flip deal and end as a DSCR-financed rental after the rehab is complete.
The important decision is whether the financing matches the property’s current condition and the exit you intend to execute.
At Ziffy, investors can find and analyze investment properties, test the numbers before making an offer, and use Ziffy Mortgage for investor-focused financing including fix and flip and DSCR loans.
FAQs
What is the minimum credit score for a fix and flip loan?
Ziffy Mortgage requires a minimum credit score of 650 for its fix and flip program. Credit can also affect pricing, leverage, and the overall strength of the file.
How much down payment do I need for a fix and flip loan?
Ziffy’s current program calls for approximately 25% to 30% down, depending on the borrower and project. First-time flippers should generally prepare for the higher end of that range.
Can a fix and flip loan pay for renovations?
Yes. Ziffy Mortgage can finance up to 100% of eligible rehab costs, provided the total loan remains within the applicable LTC and ARV limits. Rehab funds are released through the loan’s draw process.
What is the difference between LTC and ARV on a fix and flip loan?
LTC compares the loan amount with the total cost of purchasing and renovating the property. ARV estimates the property’s value after renovation. Ziffy’s program allows up to 92% LTC while also limiting the total loan to 75% of ARV, so both calculations can affect the maximum loan.
Is a fix and flip loan the same as a hard money loan?
The terms often overlap, but they are not necessarily interchangeable. Hard money is a broad description for short-term, asset-focused private financing. A fix and flip loan is specifically structured around buying, renovating, and exiting an investment property.
Can I use a DSCR loan to flip a house?
DSCR financing is generally better suited to a stabilized rental because qualification is based primarily on rental income relative to PITIA. A property undergoing substantial renovation is better aligned with fix and flip financing. If you later decide to keep the renovated property, a DSCR refinance may become the long-term exit.
Can I refinance a fix and flip loan instead of selling the property?
Yes. If the completed property works as a rental, an investor may be able to refinance the short-term fix and flip loan into a DSCR loan. The new loan will still need to meet the applicable appraisal, rent, DSCR, credit, reserve, and LTV requirements.
