Bank Said No on Your Fix and Flip? Here is How Bridge Lenders Actually Look at the Deal

Most real estate investors hit the same wall on their first or second flip. The deal looks great on paper, the comps line up, the rehab budget is solid, and then the bank passes. Usually it is not the property. It is the credit box. A community bank or a regional lender is grading you the borrower first, and the property second.

Bridge lenders flip that math. They grade the deal first, the borrower second. That is the entire reason a 90 percent loan to cost fix and flip product can fund in roughly 10 days when a conventional bank cannot fund the same deal in 60. Funding is always subject to lender approval, but the framework is fundamentally different.

How a Bridge Lender Actually Underwrites a Flip

Three numbers drive almost every fix and flip credit decision.

• Purchase price. What you are paying for the asset, verified by the contract.
• Rehab budget. Line item scope of work, not a round number on a napkin.
• ARV, or after repair value. Backed by three to six recent comparable sales, ideally within the same submarket and the last 90 to 180 days.

From those three numbers a bridge lender derives loan to cost and loan to after repair value. A typical structure looks like 90 percent of purchase plus 100 percent of rehab held in a draw account, capped at around 70 to 75 percent of ARV. The borrower brings the remaining 10 percent of purchase plus closing costs.

Why Speed Wins the Deal

A 10 day close is not a marketing line. It is the actual difference between getting the deal and losing it to a cash buyer. Sellers of distressed assets do not wait 45 days. The investor with reliable 10 to 14 day funding consistently wins inventory in 2026 markets.

Bridge lenders are built around this speed. Title, appraisal, and inspection run in parallel. No income verification gauntlet. No tax return rebuild. The credit pull happens, but a 660 or even a 620 is workable on the right deal because the asset secures the loan.

What Kills Otherwise Good Flip Deals

• Thin comps. If the only ARV support is one sale six months ago, lenders discount it.
• Over scoped rehab. A $90K rehab on a $180K purchase reads as a ground up, not a flip.
• No reserves. Most lenders want 3 to 6 months of interest reserves in liquid funds.
• Soft entity. Vesting in a clean LLC, not a personal name, is standard.

None of these are unfixable. Most flips that banks decline are still fundable through the bridge channel after a small structuring change.

The Numbers on a Real Sized Deal

Take a flip with a $200,000 purchase, $50,000 rehab, and a $340,000 ARV.

• Loan amount around $230,000 at 90 percent of purchase plus full rehab in draws.
• ARV LTV around 67 percent, comfortably inside most credit boxes.
• Carry costs for 5 months at typical bridge pricing land in the mid teens of thousands.
• Sale at ARV minus 6 percent selling costs nets the investor a meaningful five figure profit.

Results are not typical. Every market and every operator is different. But the framework holds.

When Bridge Is the Wrong Tool

Bridge is not for buy and hold. If the exit plan is keep and rent, a DSCR loan based on the rental income is almost always cheaper. Bridge is for flips, BRRRR rehabs that refinance into DSCR, and short ground up developments that sell at completion.

What to Do Next

If you have a fix and flip your bank declined, send the three numbers. Purchase, rehab, ARV. Most deals are still fundable. Start an application here: https://slatefinancial.io/apply/fix-and-flip. Funding is subject to lender approval.

For investors comparing bridge against alternatives, the apply page also routes ground up construction and DSCR rental requests: https://slatefinancial.io/apply/fix-and-flip.

Slate Financial is a commercial mortgage and business funding brokerage. Funding decisions and rates are at the sole discretion of third party lenders.

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