Fix-and-Flip Loans: How Real Estate Investors Fund Deals Without Banks

If you have ever had a bank decline your fix-and-flip loan application, you are not alone. Banks are built for stability – they underwrite borrowers, not deals. And real estate investors are not W2 employees with 2-year seasoning and a 740 FICO score. They are deal-finders, operators, and value-add specialists. The numbers on the deal tell the real story.

Here is what most investors do not know: there is an entire lending market designed specifically for fix-and-flip deals, ground-up construction, and bridge loans – and it operates completely outside the traditional banking system.

What Is a Fix-and-Flip Loan?

A fix-and-flip loan (also called a bridge loan or hard money loan) is short-term financing designed to cover the purchase and rehabilitation of a distressed property. The loan is based primarily on the asset value – specifically the after-repair value (ARV) – rather than the borrower’s tax returns or FICO score.

Typical terms:

• Loan-to-cost (LTC): up to 90%
• Term: 6-18 months
• Close timeline: 10-15 business days in most markets
• Qualification criteria: the deal numbers, not your W2

Why Banks Say No to Fix-and-Flip Deals

Banks are regulated lenders with strict underwriting criteria. They require:

• 2+ years of documented flip experience
• 620-740+ FICO scores depending on the program
• Owner-occupied or long-term rental use (not short-term resale)
• Standard appraisals that may not account for ARV

A distressed property at 70% of ARV with a clear rehab scope is exactly the kind of deal that hard-money lenders were built for – and exactly the kind of deal most banks will not touch.

How Fix-and-Flip Financing Actually Works

When you submit a deal to a private lender or bridge lender, underwriting is focused on three things:

1. The ARV (After Repair Value) – what the property will be worth when the rehab is complete. Usually supported by a BPO (broker price opinion) or appraisal.
2. The LTC (Loan-to-Cost) – the ratio of the loan to your total project cost (purchase + rehab). Most lenders will go up to 85-90% LTC.
3. The exit strategy – are you selling or refinancing? What is the realistic timeline and the exit plan if the sale takes longer than expected?

If these three elements are clean, deals move fast. Most of our investors receive a term sheet within 24-48 hours and close in 10-15 days.

Real Example: Deal Math on a $265K Fix-and-Flip

Here is how a typical deal looks:

• Purchase price: $220,000
• Rehab budget: $45,000
• Total project cost: $265,000
• ARV: $385,000
• Gross spread: $120,000
• Net after selling costs (approx 8%): $89,000+

At 85% LTC, the lender funds $225,250. The investor brings $39,750 to the table and keeps the spread. That is the business model. Banks cannot structure this. Private lenders can.

Results not typical. All funding is subject to lender approval.

Where Fix-and-Flip Loans Are Available

Slate Financial works with lenders across the United States with particular strength in Florida, Texas, Georgia, South Carolina, and the Carolinas. We also have active programs in Ohio, Pennsylvania, Tennessee, and other high-volume markets.

If you are in a market with strong rehab comps, there is likely a lending program available for your deal. Submit your deal here and we will match you with the right lender for your market.

What You Need to Apply

Most lenders will want to see:

• Property address and purchase price
• Rehab scope and budget breakdown
• ARV estimate (comp support is ideal)
• Your exit strategy (sell or refi)
• Prior flip experience (helpful but not always required)

No tax returns, no W2s, no 6-8 week wait. Just the deal.

Ground-Up Construction Loans

If you own a lot and are ready to build, ground-up construction loans work similarly. Lenders fund in draws tied to completion milestones – foundation, framing, rough-in, finish, and certificate of occupancy. We work with builders in FL, TX, GA, SC, and beyond who are developing spec homes, ADUs, and small multi-family projects.

The key qualification: the land value, the construction budget, and the projected sale or stabilized value. Not your tax return.

Ready to See if Your Deal Qualifies?

At Slate Financial, we review fix-and-flip and ground-up construction deals every day. We match investors to the right lenders based on the deal profile, the market, and the exit strategy – not just the borrower’s credit file.

Funding is subject to lender approval. Not every deal will qualify. But if your numbers are clean, we want to see it.

Submit your deal at slatefinancial.io/apply/fix-and-flip

Questions? Contact Slate Financial directly. We review every submission.

– David R. Bizousky, CEO of Slate Financial

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