One way to make money in real estate is to purchase properties, renovate them, then resell. This method, known as fix-and-flip, can be highly lucrative. However, you may need financing to purchase properties. Here are some options available that can give you the money to purchase and renovate real estate properties.

Hard Money Loan:

Good for experienced investors or new investors working with a contractor
Up to 90% of loan-to-cost; 75% after-repair value
12-24 month loan terms
6.5-12% interest rates
Qualifications include 660 minimum credit score

Cash-out Refinance Loan

Good for investment properties with 30-40% equity
Up to 75% loan-to-value
30-45 day loan terms
Qualifications include 660 FICO score; 45% maximum debt-to-income ratio; 0-6 month cash reserves; 30-40% equity

Home Equity Line of Credit

Good for primary residences with a minimum of 30% equity
Up to 85% combined loan-to-value
25-30 years loan terms
3.5-6.5% variable interest rates
Qualifications include 640 minimum FICO score; 45% maximum debt-to-income ratio; 0-6 month cash reserves; existing property with minimum 30-40% equity

Investment Property Line of Credit

Good for investment properties with 30-40% equity
Up to 75% loan-to-value
18-24 month loan terms
6.99% and up interest rates
Qualifications include $75 service fee annually; 1-5% closing costs

Bridge Loan

Good for transitioning a short-term loan to permanent financing
Between $50,000 and $2.5M; 85% loan-to-value; 70% loan-to-value refinance; 65% loan-to-value cash out
12-18 month loan terms
Interest rates starting at 7.99%
Qualifications include 20% equity; clear exit strategy

Whether you are new to real estate or ready for yet another fix-and-flip property, these financing options can be effective opportunities for you. Once you find the right loan, you can be well on your way to a successful renovation. This financing will make it easier to achieve the renovations that will make your fix-and-flip property exactly what you want it to be.