CalculateRealEstateROI

Flipping · Guide

Financing Your Flip

Hard money, private money, and lines of credit — match the source to the deal speed.

Reviewed by Keiron Brown, Founder & Editor, CalculateRealEstateROI · Educational estimates only — not investment, financial, tax, or legal advice

Key takeaways

  • Hard money fastest, most expensive.
  • Private money 9–12%.
  • LOC cheapest at scale.
  • Combine sources for capital efficiency.
  • Never use long-term financing for flip.

Core concepts

Hard money

10–14% + 2–4 points; 7-day close.

Private money

9–12%; relationships.

Business LOC

Prime + 1–3%; needs revenue history.

Step-by-step framework

  1. 1Pre-qual hard money.
  2. 2Build 5 private lenders.
  3. 3Apply for LOC at year 2.

Common mistakes to avoid

  • Single capital source.
  • No LOC backup.
  • Personal guarantee on hard money + LOC.

Frequently asked questions

Min credit for hard money?

650.

Private money structure?

Note + DOT, 6–12 month.

LOC amount?

$250–500k typical.

Interest-only OK?

Yes for flips.

Action checklist

  • ☐Two hard money quotes.
  • ☐Private lender list.
  • ☐LOC application.
  • ☐Exit timeline.

More from House Flipping

House Flipping Best Practices
Discipline, not creativity, drives flip profit — accurate ARV, locked scope, fast execution.
Common Flipping Mistakes
Overpaying, overbuilding, and overstaying — the three errors that turn a profitable flip into a loss.
Beginner's Guide to Flipping
Your first flip — small scope, conservative budget, proven team.
Advanced Flipping Strategy
Parallel deals, capital recycling, and tax planning for high-volume flippers.
Flipping Resource Center
Calculators, market intelligence, and tools for flip underwriting and execution.
70% Rule for Flipping
Why the 70% rule originated in flipping and how to bend it safely in hot markets.