If you’re just getting started in real estate investing, chances are you’re looking to start flipping houses. Fix and flip loans are different than a loan for a house you’re going to live in. For starters, the term of the loan is quite short, usually from six to 12 months. Some loans are for up to 36 months, however. The term is so short because it only needs to last from purchasing the house, through repairing it and selling it. Typically, this process lasts around one year. While interest rates on residential mortgages are currently around 4%, flip loans start at just under 8%. California flip loans have other important differences from other loans. The down payment required may be as low as 10%. In general, fix and flip loans will finance about 65% of the After Repair Value (ARV). At LendingXpress, we will consider loans up to 100% of the repair costs.
Contact LendingXpress to Learn About our California Flip Loans
New house flippers should also budget for several different costs that are unique to flip loans. The lender usually charges a fee of 1 to 5% of the sale price once the house sells. Be sure to carefully research the cost of fixing up the house before you put in an offer. You should also look at the selling price of comparable properties to make sure you will get a good return.
Please get in touch with us to get more details about flip loans with LendingXpress. We pride ourselves on customizing a loan for your needs.