Capital for fix and flip lenderswithout a warehouse line.

Why is funding fix and flip loans hard?

A fix and flip loan finances the purchase of a property and part or all of its renovation, repaid when the investor sells. That makes it hard to finance on a warehouse line:

• It is a bridge loan with construction risk. Many bank warehouse programs are built for residential mortgages that are sold within weeks. One published bank program lists bridge and construction loans as ineligible collateral and states it does not finance hard money or fix-and-flip loans.
• Draws keep adding to the balance. Rehab money goes out in draws after inspections, so the amount of capital in the loan rises over its life.
• Loans are held to maturity. A six- to twelve-month loan can outlast a line’s dwell limit, especially if the borrower needs an extension.

How do fix and flip lenders fund more loans?

Most use a mix: their own capital, money from individual investors, a credit line where they can get one, and selling or placing loans. Each has trade-offs in cost, control and how much of your own cash stays in each loan. The warehouse line alternative page compares them side by side.

With direct capital placement, the capital partner reviews your full file before closing, commits to the whole loan, including the rehab holdback, funds the purchase advance at closing, and the loan is assigned to it. You don’t front draws from your own capital. You stay the borrower’s lender of record, service the loan and coordinate inspections. Each draw is requested through Lender Capital and approved and funded by the capital partner from the holdback.

What do capital partners look for in a fix and flip loan?

Capital partners each set their own criteria. Expect them to look at the as-is value and the after-repair value (ARV), loan-to-cost and loan-to-ARV, the scope of work and budget, the borrower’s experience with similar projects, the exit (sale price and timeline), title and insurance. A clear draw schedule and inspection process matter. See how lenders evaluate rehab budgets and ARV.

Frequently asked questions

Can fix and flip lenders get a warehouse line?

Some can, usually from specialty lenders rather than banks, often with lower advance rates, draw controls and personal guarantees. Many bank warehouse programs exclude fix and flip and other hard money loans entirely. Check each provider’s eligibility rules.

Who funds the rehab draws on a placed loan?

On Lender Capital, the capital partner funds them: it commits to the whole loan, including the rehab holdback, and funds each draw after inspection, once the lender requests it through Lender Capital and the partner approves.

Do I keep the borrower?

Yes: with Lender Capital, you originate the loan, stay the borrower’s point of contact and service the loan. How the capital partner is disclosed follows the loan documents and applicable law.