Fix and Flip Loan Requirements (2026)

What are the requirements for a fix-and-flip loan?

Most fix-and-flip lenders want a non-owner-occupied investment property, a credit score commonly around 620–680 or higher, verified cash for the down payment, closing costs and several months of carrying costs, a line-item rehab budget, and an ARV that supports the loan. Experience raises leverage, but first-time flippers are commonly eligible. Terms vary by lender.

Unlike a home mortgage, a flip loan usually does not qualify you on W-2 income or a personal debt-to-income ratio. The lender is underwriting a short project: the price, the scope, the after-repair value, your cash cushion, your track record and the exit. For the full product overview, see the fix-and-flip program page.

Fix-and-flip requirements at a glance

A strong ARV does not fix a weak file elsewhere. A deal can miss on liquidity, title, property condition, permits or experience even when the margin looks excellent. The ARV and loan-to-cost guide shows how the sizing tests interact.

Credit score and credit history

There is no industry-wide minimum. Many private lenders set floors somewhere around 620–680, and the best leverage and pricing are often reserved for scores of 700 or higher. A lower score usually means less leverage rather than an automatic no. Underwriters also look at recent mortgage lates, open judgments or liens, bankruptcy and foreclosure history, and past defaults on investor loans, which can matter more than the score itself.

Because flip loans are short and asset-driven, credit commonly sets your tier while experience and liquidity set how far that tier stretches. If your score is borderline, share a range when you tell LoanFight about the deal rather than assuming a headline number applies.

Cash to close and liquidity

Flip loans rarely cover everything. Plan for:

• Down payment: the part of the purchase price the lender does not advance, for example 10%–15% at 85%–90% purchase leverage, more if the ARV cap or as-is value binds.
• Points and closing costs: commonly 1–3 origination points plus appraisal, title, legal, processing and insurance.
• Carrying costs: interest payments, taxes, insurance, utilities and HOA dues for the full hold. Many lenders want several months of payments verified in the bank.
• Working capital for draws: most lenders reimburse completed work, so you front each stage before the draw is paid. See the draw schedule guide.
• Contingency: the holdback usually covers only the approved budget, not overruns.

Worked example: how much cash you need to show

Assume a $250,000 purchase, a $60,000 rehab and a $420,000 ARV. The lender offers 85% of purchase, 100% of rehab and a 75% ARV cap, with 2 points. Other closing costs, a 10% contingency and six months of non-interest carrying costs are illustrative.

Interest: every 1% of annual interest on the fully drawn $272,500 costs about $227 a month ($272,500 × 1% ÷ 12). Multiply by the actual rate and the months you expect to hold, and add it to the $58,750. If the lender also asks for interest reserves in verified funds, that number must be in the bank at closing, not just in your plan.

Property, scope of work and ARV support

Most flip programs focus on one- to four-unit residential properties; condos, townhomes and small multifamily are often allowed, while rural, mixed-use, land and heavy structural projects may need another program or a construction loan. Lenders want:

• A line-item scope of work: each trade with a cost, so the lender can build the draw schedule and judge whether the budget matches the ARV.
• An ARV the comps support: an appraisal or valuation “subject to” the planned work, based on renovated sales nearby. See how ARV is set.
• Permits and a qualified contractor where the work requires them; some lenders review the contractor or require a general contractor for larger scopes.
• Lead-safe practices on pre-1978 homes: federal EPA renovation rules generally require certified firms for work that disturbs painted surfaces.

Entity, guaranty and business purpose

Many lenders close flip loans in an LLC or other entity, with operating documents, good-standing evidence and a personal guaranty from the principal owners. The loan must be for a business purpose: you cannot live in the property. Credit to acquire or improve non-owner-occupied property is generally business-purpose credit under 12 CFR 1026.3(a), so these loans do not use the consumer Loan Estimate and Closing Disclosure forms. Ask for a written, itemized term sheet instead and compare offers line by line.

Documents to prepare

• Purchase contract and property details
• Line-item rehab budget and scope of work, with contractor bids if you have them
• Your ARV estimate with comparable renovated sales
• Bank statements for down payment, closing costs and reserves
• Track record: closing statements, deeds or photos from prior projects (see the first-time flipper guide if you have none)
• Entity documents: articles, operating agreement, EIN and good standing
• Identification and credit authorization for each guarantor
• Insurance quote (often builder’s risk or vacant-property coverage)
• Exit plan: resale price and timeline, or the rental and DSCR refinance numbers

Fix and flip requirements: frequently asked questions

Sources and review notes

Business-purpose treatment of credit to buy or improve non-owner-occupied property: CFPB, Regulation Z, 12 CFR 1026.3(a) and its official interpretation. EPA lead-safe renovation rules: EPA Renovation, Repair and Painting Program. Ranges describe commonly published private business-purpose lending terms as of October 2026; they are not any single lender’s guidelines and not a LoanFight offer. Arithmetic in the worked example was checked line by line.

Educational information only, not an offer, approval or financial, tax or legal advice. LoanFight is not a direct lender and does not set final loan terms. Equal Housing Opportunity.