Our line on flips is short, and it’s on our program page. “If you find a great flip deal, we’ll find a way to fund it!” Motto aside, there are requirements. The fix and flip loan requirements at GW Private Capital come down to a down payment, some flipping experience, a property we can underwrite and a plan for getting repaid. Each one looks like this in practice.
Down payment
Most of the private investors we work with want the buyer to put in 10% to 20% of the purchase price. Some go further, up to 100% of the purchase price, either as one loan or as a first and second mortgage together, and on those we’ll sometimes set up a profit-sharing arrangement.
Don’t plan around the 100% number. Plan around the first one and treat anything above it as a bonus.
Experience
Our fix and flip program typically requires some level of experience. That’s on our program page, so you may as well hear it here first. If you’re growing a portfolio of flips, you’re in the right place. If this is your first, say so up front. We decide case by case.
The property
We look at most property types, including single family homes, condos, townhomes, apartment buildings and mixed-use. Distressed is normal for a flip. Vacant properties are fine, and so are properties in disrepair. A property that’s already on the market doesn’t rule it out either.
A stalled rehab is also fair game, since we can arrange loans to complete some unfinished construction or rehab projects. Land is the exception. On vacant land we lend no more than about 25% of fair market value. And for scale, most of the loans we arrange are under $1,000,000.
We fund flips in Los Angeles, Riverside and San Bernardino counties, and our FAQ says we lend across California.
Credit, taxes and entity
There’s no minimum FICO score. Borrowers with poor credit are on the table, and so are borrowers who haven’t filed taxes in a few years. We can lend to most entities, including a trust, a corporation or an LLC.
The property and its equity carry most of the decision. We’ll still ask for proof that you can repay the loan.
What you send, and when
The first step is our online loan request. It asks for the loan amount, the purpose, the property address and type, the estimated value, the purchase price and whether you live in the property. Pick “Purchase fix and flip” as the purpose. A licensed loan officer should contact you within a few hours, and longer on weekends and holidays. There’s no obligation, no cost and no credit pull.
We don’t need the whole application package to put a written proposal and a Letter of Intent in front of you. After you sign the Letter of Intent, we build the full file, which includes the signed borrower application, bank statements, financials, an appraisal or broker price opinion, a preliminary title report and escrow instructions.
Timing
We can fund in as little as 5 days. Most loans run 10 to 14 days from start to finish, so give your purchase contract room for that. Most of our loans don’t carry prepayment penalties, and most do require monthly payments.
If you’re selling, not flipping
A homeowner or agent who wants to fix a property up before listing it is looking at a different product. Our Repair to Sell program is built for that, and per the program page we can connect you with contractors and put together a written repair and remodel bid.
Where to go next
Pricing depends on the deal, and we will provide a written good faith estimate or conditional loan proposal. The program details are on our fix and flip loans page, and if you want the bigger-picture case for flip financing, our post on how to use a fix and flip loan covers it. If you’ve got a deal in front of you, send the request.
GW Private Capital, Inc. is licensed by the California Department of Real Estate #01988401. This article is general information and not a commitment to lend.
