Fix and Flip Loans, also known as Hard Money Loans, are short-term, asset-based, interest-only loans that rely more heavily on the investment than the investor. While the investor’s credit worthiness and liquidity are considered, the After Repair Value (ARV) of the investment property is the primary factor for the loan underwriters.
Fix and Flip loans provide more money for investment projects than conventional bank loans. A bank loan only funds a portion of the unrenovated value of the property whereas a Fix and Flip loan provides a portion of the ARV (see the comparison).
Depending on the investment property, our fix and flip loans are generally issued for 65-75% of the ARV and the funds are distributed as needed, according to the renovation schedule. The initial distribution of funds is for the purchase of the property. Then, as renovation milestones are reached, additional funds are distributed until the project is completed. The borrower only makes monthly interest payments for the term of the loan then pays back the loan when the renovations are complete and the property is sold or refinanced as a rental. We offer 6, 9, and 12-month loan terms. Some additional fees may apply.
| Loan Factors | Bank Loan | Crossroads Loan | Notes |
| As is Value | $78,000 | – | Banks may loan up to 80% but only on the as is value. Crossroads loans 65-70% on the ARV. Banks don’t provide enough funds to purchase the house. Crossroads loans enough to purchase and do most or all of the renovations. |
| Repairs Needed | – | – | |
| Total Investment Needed | – | – | |
| After Repair Value (ARV) | – | $200,000 | |
| Loan to Value (LTV) | 80% | 65% | |
| Max Loan | $62,400 | $130,000 | |
| Available Repair Funds | $0 | $52,000 | |
| Funds Needed | $80,717 | $13,117 | |
| The table does not represent all fees. It only depicts the key differences between banks and Crossroads lending. | |||
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What is a Bridge Loan? A bridge loan is a short-term financing option designed to help property investors secure quick funding for a new property purchase before selling their current one. This loan type “bridges” the gap between the immediate financial need and the long-term financing solution.
Benefits of Bridge Loans:
If you’re in need of fast funding, a bridge loan may be the ideal solution to secure your investment opportunities without waiting for the sale of your existing property.
What is a Cash-Out Loan? A cash-out loan is a financing option that allows real estate investors to tap into the equity of an existing property. By refinancing your current mortgage, you can unlock a portion of your home’s value and use the funds for other investment opportunities, renovations, or debt consolidation.
Benefits of Cash-Out Loans:
Whether you want to invest in a new property or renovate an existing one, a cash-out loan offers the liquidity you need to grow your real estate portfolio.
(Buy, Rehab, Rent, Refinance)
What is a BRRR Loan? The BRRR strategy is an effective method for building wealth through real estate. It stands for “Buy, Rehab, Rent, Refinance,” and involves purchasing a property, renovating it, renting it out, and refinancing it to pull out the cash you invested. A BRRR loan is designed to finance all of these steps, helping investors maximize their returns while minimizing the initial capital required.
Benefits of BRRR Loans:
The BRRR method is one of the most effective strategies for real estate investors, and our BRRR loan program provides the financing you need to complete each phase successfully.
Designed for single-family rentals, small multi-family properties (2-4 units)
Qualification based on the property’s income, not personal income
Minimal documentation required
Financing for duplexes, triplexes, and fourplexes
Ideal for investors seeking to diversify their portfolio
Flexible terms to support long-term growth
Hybrid loan solutions that consider both property income and borrower income
Ideal for investors looking to leverage both personal and property cash flow
Benefits of DSCR Loans:
It’s a simple process. Submit a credit application and some personal financial information, then submit a loan request. Once you are approved, we will order an appraisal, provide the funds to purchase the property and provide rehab funding as the project progresses.
A “Hard Money Loan,” is a short-term, asset-based, interest-only loan that is determined more by the after repair value (ARV) of investment than the investor.
We loan money for one to four family residential units in the Kansas City area. Please note, properties must not be owner-occupied in order to qualify.
Yes, an appraisal is required. We will schedule the appraisal for you and appraisal fees must be paid in advance. DO NOT ORDER YOUR OWN APPRAISAL.
We require a Builders’ Risk certificate of insurance with a vacancy clause for the term of the loan, either paid in advance or at closing. Flood insurance is required for any property located in a flood zone.
Submit draw requests for completed work by Friday at noon and we will inspect and fund completed work by the following Friday.