No-Money-Down Fix-and-Flip Loans

Fix-and-flip loans provide short-term financing to real estate investors who want to buy properties, make improvements, and sell them for a profit. No-money down fix-and-flip loans can help you get the funds you need to purchase a property without any upfront investment. 

Getting a fix-and-flip loan with no money down is possible with the right lender. If you’re interested in venturing into flipper territory or you need funding for your next flip, here’s the rundown on how these loans work.  

Can you get a fix-and-flip loan with no money down? 

Lenders offer fix-and-flip loans with no money down—also called 100% financing. You don’t pay anything toward a down payment on the loan, but you may need to pay closing costs. 

Depending on the lender, you might have the option to roll closing costs into the loan so you pay nothing out of pocket. You might pay nothing down, but lenders may expect something in return. That can mean either:

1. Offering some kind of collateral to secure the loan separate from the property you’re buying.
2. Having someone else sign off on the loan as a guarantor, which means they agree to pay the debt if you default. 

With a typical mortgage, your home is the only collateral you need. If you don’t make the payments, the lender can take the property back. The down payment on a standard mortgage can be as low as 0% for VA or USDA loans. FHA loans require a down payment of just 3.5%. A first-time home buyer’s down payment could be 3% or less based on eligibility requirements.

With a no-money-down fix-and-flip loan, the lender might ask you to pledge a different property you own or other assets to secure the loan. Those assets’ value must equal the lender’s minimum down payment requirement.

 Lenders may expect borrowers to put anywhere from 10% to 30% down on a fix-and-flip loan. 

Where to get a fix-and-flip loan with no money down

There are plenty of fix-and-flip lenders to consider, but you’ll need to do a little digging to find ones that offer no-money-down financing. 

We’ve selected five of the best options for getting a fix-and-flip loan with no money down as a starting point for your research. Click the lender’s name in the table for more details about its no-money-down loans.

Pine Financial Group

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• Get up to 100% financing on purchases, repairs, lender fees, and closing costs
• Interest-only monthly payments 
• No application fees and fast closing

Pine Financial Group offers 100% financing fix-and-flip loans to investors in Colorado, Minnesota, Virginia, Washington D.C., and Wisconsin. Loan funds are held in escrow and released as work is completed. If you come in under budget, any remaining funds are turned over to you. 

These rehab loans follow a nine-month balloon structure, meaning one large balloon payment is due at the end of the loan term to satisfy the debt. In the meantime, you’re only required to make interest-only payments each month. 

No prepayment penalties apply if you pay your loan off early, and no minimum interest is due. 

Ideal Capital Solutions

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• 100% financing available for one- to four-unit non-owner-occupied properties
• Close in as little as 10 days
• Choose from six- to 12-month loan terms

Ideal Capital Solutions works with new and seasoned real estate investors to extend fix-and-flip loans with no money down. Eligible borrowers can get up to 100% financing, including the cost of the property itself and your estimated budget for improvements. 

The lender doesn’t disclose the minimum requirements to qualify for funding, but you can prequalify online. You’ll need to tell Ideal Capital Solutions how much you have in cash reserves, a little bit about your experience with flipping properties, and your estimated credit score. Once approved, closing happens as fast as two weeks. 

Ideal Capital Solutions’ 100% financing options are available in Colorado, Connecticut, Delaware, Florida, Georgia, Illinois, Indiana, Kansas, Massachusetts, Maryland, Missouri, North Carolina, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island, South Carolina, Tennessee, and Virginia.

Rehab Financial Group

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• Up to 100% financing for the purchase price and rehab costs
• Requires a minimum 620 credit score and reliable income
• Choose from an eight- or 12-month loan term

Rehab Financial Group offers fix-and-flip loans with no money down ranging from $50,000 to $3 million. Rates are competitive, and borrowers have the option to purchase points to buy down their rate further. The maximum loan term is 12 months, which is typical of fix-and-flip loans. 

You’ll need a 620 credit score or better to qualify. Rehab Financial Group also considers your income, cash flow, and savings. You can make interest-only payments during the loan term with no prepayment penalty. A $250 loan application fee applies. 

RFG doesn’t specify which states its no-money-down loans are available in, but its fix-and-flip loans are available in the states listed below.

Money Source of America

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• Up to 100% financing for purchase and rehab costs
• No previous fix-and-flip experience required
• State availability not disclosed

Money Source of America offers fix-and-flip loans with no money down for investors who are purchasing one- to four-unit residential properties. 

The documented loan program allows you to borrow 100% of purchase and rehab costs, repayable over a term of 12 to 18 months. Interest-only payments are required, with current rates starting at 9%.

To qualify, you need a minimum 620 credit score, proof of income, liquid assets, a positive mortgage history, and no record of bankruptcy within the last three years. You also must live within 60 miles of the investment property and be located in a state where Money Source of America lends. (We couldn’t locate a list of eligible states on its website.)

Arch Loans

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• Borrow up to 100% of the purchase price
• Maximum loan amount up to $10 million
• Choose from a six or 12-month loan term

Arch Loans extends fix-and-flip loans with no down payment requirement to borrowers in Arizona, California, Colorado, Illinois, Michigan, Oregon, Texas, and Utah. 

These loans are intended for residential properties with one to four units, but you can also use them to buy a condo for your flip project. 

You can select a six- or 12-month loan term, with the option to request a six-month extension if necessary. No prepayment penalty applies if you pay the loan off early, but the lender charges an $850 processing fee and a $450 first trust deed servicing fee. 

Pros and cons of no-money-down fix-and-flip loans 

Fix-and-flip loans with no money down can give you the funding you need to buy an investment property and complete renovations. But consider the potential downsides before applying for one. 

You might consider other options for financing a fix-and-flip investment, such as leveraging your home equity, using small business financing options if you’re a professional investor, or getting backing from a private capital firm. 

Keep in mind those options have pros and cons, too. 

Our expert’s advice to fund your fix-and-flip project

Erin Kinkade

CFP®

To choose which funding approach is best for you, I suggest first considering the available term lengths. With unforeseen circumstances such as weather, availability of contract employees, and economic conditions, a shorter-term loan could put you in a position to repay the loan before you have the funds. Second, look at how longer-term options that offer no down payment compare to loans that require a down payment. And, of course, look at the interest rates, taking into account whether the rates are fixed or variable.

How to get a fix-and-flip loan with no money down 

If you’re interested in a fix-and-flip loan with no money down, it helps to know what to expect. You’ll need to know what lenders are looking for in a borrower, how to apply, and how the lender will release funds once you’re approved.

What do you need to get approved for a fix-and-flip loan with no money down? It depends on the lender, but most lenders look at the following:

• Credit scores
• Income
• Cash savings
• Assets, including property you own or investment accounts
• Previous experience with flipping properties

Minimum credit score requirements vary, but a 620 credit score requirement is typical. 

If you’re getting what’s called a “no doc” loan, meaning no documentation is required, the lender may not look at your credit at all. These loans may be easier to qualify for, but they can charge much higher rates because they represent a greater risk to the lender. 

Aside from those qualifications, lenders look at the deal itself. That includes checking your estimated repair budget to gauge your return on investment. It’s not uncommon for the lender to request an appraisal to determine the property’s value during the underwriting process. 

In terms of documentation, you might need the following to apply for a fix-and-flip loan with no money down:

• Your most recent tax returns
• Pay stubs for the previous three to six months
• Bank statements for the previous three to six months
• Purchase contract for the property
• Estimated budget of repair costs and your timeline for completing renovations
• Documents for your business formation if you’re investing in real estate as an LLC, rather than an individual
• Details about any previous fix-and-flip projects you’ve completed

Taking time to compare lenders, review the minimum eligibility requirements, and compare loan terms can help you find the best funding option for your needs. 

Our expert weighs in on fix-and-flip loans

Erin Kinkade

CFP®

Whether I would recommend a no-money-down fix-and-flip loan depends on the opportunity you’re facing. If the fixer-upper is a deal you can’t pass up, your only option is a no-down-payment loan, and you have the risk tolerance to take on the project, it could be beneficial. However, if the opportunity is not attractive and you don’t feel comfortable taking on the additional risk, waiting until you have a down payment or choosing a better option—whatever that may be—could be in your best interest. It depends on the opportunity and your tolerance for risk. 

FAQ

Do banks give fix-and-flip loans with no money down?

Many traditional banks don’t offer no-money-down options for fix-and-flip loans because these loans carry a higher risk for the lender. Many banks require a down payment of 20% to 25% of the purchase price. It’s essential to do your homework and explore multiple lending options.

Is a fix-and-flip loan always a hard money loan?

Fix-and-flip loans are not always hard money loans. Hard money lenders are common sources for these types of loans, but other options may be available. 

For example, you can obtain a fix-and-flip loan through certain real estate crowdfunding platforms or private money lenders. It depends on your specific needs, your financial situation, and the nature of the project.

How much money do you need for a fix-and-flip?

The amount needed for a fix-and-flip project varies depending on factors such as the property’s purchase price, the extent of repairs required, and the local real estate market’s conditions. 

As a rule of thumb, you should estimate your costs to include purchase, repair, carrying, and selling. This formula can give you a ballpark figure, but each project will require a detailed budget.

What credit score do you need to flip houses?

There is no definitive minimum credit score needed to flip houses, but many lenders require a credit score of at least 620. And the higher your credit score, the better loan terms you may be eligible for. 

However, hard money lenders are often more focused on the potential property’s profitability than the borrower’s credit history. As always, it’s important to consult with a loan professional to assess your situation.