Fix and Flip Permanent Loans
Permanent financing for fix and flip transactions is a tricky proposition, but can work in some situations. To qualify, properties must currently be in decent condition, and borrowers must bring their own funds to rehabilitate the property.
Permanent Loans for Fixing and Flipping Commercial and Multifamily Properties
While permanent financing might a good idea for an individual purchasing their own home, isn't usually the best idea for a fix and flip transaction. Mainly, this is because permanent loans typically don't allow borrowers to purchase properties in poor or distressed condition — and, in most cases, they don't provide any funds for property rehpair or rehabiliation. However, that doesn't mean that permanent loans don't have their place in the fixing and flipping equation.
For example, if a investor wanted to fix up a property with their own funds (or perhaps, with funds from a HELOC or an investment property line of credit) and hold the property for a few years before reselling, or 'flipping' it, a permanent loan could be a good idea. Despite that, for investors who want to purchase, repair, and quickly flip a distressed property, a permanent loan usually isn't in the cards.
Sample Terms for Fix and Flip Permanent Loans in 2025
Size: Varies
Term: 15 to 30 years
LTV/Leverage: Up to 80% LTC (or 65% to 70% ARV)
Lender Fees: Typically up to 1.00%
Closing Costs: 2.00 - 5.00%
Credit Score: 640+
Debt-to-Income (DTI) Ratio: 45% or less
Timing: These loans typically close in between 30 to 45 days
Advantages:
- Lower interest rates and fees than other kinds of fix and flip financing
May be difficult or impossible to get for properties that are in poor condition
Provides no additional funding for rehab/renovations
Disadvantages: