The Quick Read: Usually, yes: even a flip loan that advertises full financing leaves you paying something at closing, because the lender typically funds a share of project cost that is capped by after-repair value, and you still cover upfront lender charges, title and insurance, and liquidity the lender wants to see. The exact amount varies by lender, property, and experience. Subject to lender guidelines, and not a commitment to lend.
- Hard money leverage is sized on project cost, which means purchase price plus rehab budget. It is not sized on purchase price alone.
- Across the network, fix-and-flip leverage typically runs 85%, 90%, or 93% of project cost depending on completed projects, always capped at 75% of after-repair value.
- Rehab money usually arrives in draws against completed work, so you often fund early work yourself.
- Upfront charges, title, insurance, and reserves are usually yours even on a strong deal.
- A thin-margin deal needs the most cash. A deal bought well below its finished value needs the least.
What Does “100% Financing” Actually Mean?
It means 100% of cost, not 100% of the price you pay today. A lender that advertises full financing generally covers the purchase and the rehab only while the total stays under a cap tied to what the finished house will be worth. Nav describes 100% financing as loan-to-cost, not loan-to-value, and notes that no cash is needed down only when the deal sits comfortably inside the after-repair-value threshold.
What this loan actually costs to carry.
Hard money is sized against the project and priced by time. Enter the deal and see how much the program will lend, the cash required at closing, the carry while you hold it, and what is left at the exit.
Leverage tiers on the current program: 85% with fewer than 2, 90% with 2 or more, 93% with 5 or more completed projects — every tier capped at 75% of after-repair value. Loan amounts up to $5,000,000, larger by exception; terms of 6 to 18 months, interest-only, no prepayment penalty. The rehab portion funds in draws against completed work, not at closing.
Program parameters shown update from Lendmire’s centralized guideline source. Rate, points, and months are editable assumptions, not quoted terms.
Cost cap sets the loan · positive spread
Illustrative estimate only — not a quote, Loan Estimate, approval, or commitment to lend. Rate, points, and months are editable assumptions. Hard money is business-purpose financing for real estate investors, not a consumer mortgage. Leverage on the current program tops out at 93% of project cost for investors with a documented track record, capped at 75% of after-repair value, with rehab funding up to 100% of the documented budget released in draws; actual terms vary by lender, borrower experience, property, and exit. Lendmire is a mortgage broker, not a lender.
Loan-to-cost is the loan divided by purchase price plus rehab. Loan-to-value divides the loan by what the property is worth. The two sound alike and behave very differently.
Here is how the programs we place files with are built. Fix-and-flip leverage is tiered by documented completed projects: 93% of project cost at five or more, 90% at two or more, and 85% with fewer than two. Every tier is capped at 75% of after-repair value. Bridge purchases with no rehab reach up to 80% of purchase price. The top tier is reserved for experienced investors, and all of it varies by lender, property, and experience.
There is no true 100% purchase program in the network. Up to 100% of the rehab budget can fund, but it comes out in draws against completed work. That figure is a rehab-budget number. It is never a purchase loan-to-value.
What Makes Up Cash to Close?
Cash to close is everything you must wire or bring on closing day beyond what the lender funds. It is bigger than the down payment alone. Think of it as the check you write after the lender’s money is subtracted.
| Component | What it is | Can it be rolled in? |
|---|---|---|
| Equity gap | Project cost not covered by the loan | No |
| Lender charges | Upfront fees the lender assesses | Varies by lender |
| Title and escrow | Search, settlement, recording | Rarely |
| Appraisal and processing | Valuation and file costs | Varies by lender |
| Insurance | Policy on the property at closing | Rarely |
| Reserves | Liquidity the lender wants verified | Not a cost, but must be on hand |
Nav reports that these upfront charges are customarily paid by the borrower at closing and that a hard money lender generally asks for about 10% of appraised value down, with the figure varying by lender. That is a market-wide number built on value. Our network sizes on cost, so the equity gap on a typical flip is 7% to 15% of project cost before fees, with the stronger tiers on the low end.
Some lenders let certain costs be financed into the loan. That lowers the check you write, but you pay interest on a larger balance for the whole term. Ask which line items can be financed before you assume any can.
Same Loan, Three Deals: Run the Numbers
The ARV cap decides how much cash you bring, and the deal’s margin decides whether the cap binds. Run the numbers on three flips at the middle leverage tier of 90% of project cost with the 75% after-repair-value cap. These are modeled assumptions for illustration, not market data.
| Deal | Project cost as % of ARV | Loan as % of cost | You bring (% of cost) |
|---|---|---|---|
| Strong spread | 70% | 90% | 10% |
| Typical spread | 80% | 90% | 10% |
| Thin spread | 85% | About 88% (cap binds) | About 12% |
| Very thin spread | 90% | About 83% (cap binds) | About 17% |
On the first two deals, 90% of cost lands at 63% and 72% of after-repair value, safely under the cap. The loan is whatever the cost tier allows. On the thin deal, 90% of cost would equal 76.5% of ARV, which is over the cap. The lender stops at 75% of ARV, and you fund the difference.
Now change the borrower instead of the deal. Take the typical spread above. An investor with fewer than two completed projects sits at the 85% tier and brings 15% of cost. At two or more, the tier is 90%, so the investor brings 10%. At five or more, it is 93%, and the investor brings 7%. Same house, same rehab, three different checks.
Add the fees and the liquidity the lender wants to see, and the total is always larger than the equity gap. That is why a loan labeled 100% still rarely means zero out of pocket.
Your Cash Needs Run the Whole Project
Closing day is only the first draw on your bank account. Most flips need cash at five different points, and investors who plan only for the first one get squeezed in the middle.
| Stage | What you fund |
|---|---|
| Closing | Equity gap, upfront charges, title, insurance |
| Early rehab | Work done before the first draw is released |
| Mid-rehab | Gaps between completed work and reimbursement |
| Carry months | Interest-only payments, utilities, taxes, insurance |
| Exit | Selling costs, or costs of refinancing into long-term financing |
Draws deserve a closer look. The lender typically holds the rehab budget back and releases it after inspections confirm completed work. You often pay the contractor first and get reimbursed. A good plan keeps enough liquid cash to carry the project between draws.
Terms on the current program run 6 to 18 months, interest-only, with no prepayment penalty. Carry months add up when a rehab slips, so budget for the full term, not the best case.
Can You Close With Little or No Cash?
Sometimes you can close with very little cash, but only when the deal and the borrower both support it. Three things move the number down.
The spread. A property bought well below its finished value keeps the loan inside the cap, so the cost tier does the work. A deal with a thin spread can’t reach the top of any tier, because the cap binds first.
Experience. Documented completed projects move you up the tiers, from 85% toward 93% of project cost. First-time investors qualify at the lower tiers. Experience mostly changes leverage rather than eligibility, though underwriting still looks at the property, the plan, and the exit. A 620 minimum score applies, with additional conditions below 660.
Structure. Some lenders will take a lien on a second property in place of cash down, which is a lender-specific structure. Others allow costs to be financed in. Both trade lower cash today for more risk or more interest later.
Even in the best case, expect upfront charges, title, insurance, and reserves. A quote that says no money down usually describes the equity gap, not the full wire.
Ground-up construction works differently. At three or more completed projects, it reaches up to 90% of cost and 75% of completed value, and construction funds are held back and released in draws. Experience matters more there than on a rehab.
How to Cover the Gap and Lower the Check
If you are short, you have a few honest options. Each has a catch.
- Your own savings. The cleanest source, and the easiest to document.
- A partner. A partner can fund the gap in exchange for a share of profit. The agreement should be in writing before closing.
- A smaller first deal. Cutting project size cuts every cash line at once. Many investors start here for that reason.
- Borrowed funds. Lenders review where your cash came from, and some will not accept borrowed money as the equity gap. Ask before you rely on it.
To reduce cash to close without changing your partner structure, try these:
- Negotiate the purchase price. A lower price improves the spread and can pull the loan back under the cap.
- Ask for a seller credit. It offsets closing costs, though some lenders limit how credits count.
- Finance eligible costs into the loan. This lowers the check but raises the balance you pay interest on.
- Trim the rehab scope. A smaller budget means less early work to float between draws.
Source-of-funds review applies to whatever you bring. Keep statements showing the cash has been in your account, and avoid large unexplained deposits right before closing.
Closing-Day Mechanics and What If You’re Short
You will usually wire the funds, not hand over a personal check. Ask for the final figure from the title or escrow company ahead of closing day, and compare it line by line to the lender’s term sheet.
A short note on paperwork: these are business-purpose investor loans, reviewed differently from a standard owner-occupied mortgage. The FDIC’s compliance manual lists credit extended primarily for a business purpose among the exemptions from consumer lending rules. In practice, your cash-to-close number comes from the lender’s term sheet and the settlement statement, not from the consumer disclosure forms a home buyer receives. That makes reading the term sheet carefully your job.
If you discover you are short, tell the lender and the title company right away. Waiting costs you options. Depending on the contract, a shortfall can mean delays, a renegotiation, or lost earnest money. A more affordable fix is catching it before you go under contract by requesting a written estimate first.
Across the network, one pattern shows up often. Investors budget for the equity gap and forget carry costs and the early-rehab float, so the problem appears in month two or three, not at closing. The strongest files show liquidity well beyond the closing wire.
A Pre-Application Checklist
Ask each lender the same questions so the comparison is fair.
1. What is the leverage as a percentage of project cost, and what is the after-repair-value cap? 2. Which upfront charges are paid in cash, and which can be financed in? 3. How much liquidity or reserves must I show after closing? 4. How are rehab draws released, and how much early work must I fund myself? 5. What is the total cash required, in writing, for this specific deal? 6. What documented completed projects count toward my tier? 7. Does the term, 6 to 18 months, fit my rehab schedule with room to spare?
Compare offers on total cash required, not on the headline percentage. Tax treatment varies; consult a qualified professional.
Key Terms Defined
Cash to close: The money you bring to closing beyond what the lender funds, including the equity gap and upfront costs.
Loan-to-cost (LTC): The loan divided by purchase price plus rehab budget.
After-repair value (ARV): The estimated worth of the property once the rehab is finished.
Draw: A release of rehab funds after the lender confirms completed work.
Reserves: Cash you must show on hand after closing, so the lender knows you can carry the project.
Bridge loan: A short-term purchase loan with no rehab component, which in this network reaches up to 80% of purchase price.
Where a DSCR Loan Fits After the Flip
Hard money is short-term financing sized on the finished value of the project. A DSCR loan is long-term financing sized on the property’s rental income, qualifying primarily on property-level rental income covering the payment, subject to lender guidelines. Many investors refinance out of hard money into DSCR financing once a rental is stabilized, and Lendmire brokers that path.
On the DSCR side, cash-out refinances top out around 75% LTV on standard rentals, with about six months of seasoning as the common expectation. Coverage of 1.00 is where select programs start. Stronger ratios open better pricing and leverage. Reserves vary by lender, leverage, and loan size. A DSCR ratio compares rent to the full monthly obligation, so it is not the same as positive cash flow. Lendmire’s complete DSCR loans guide covers qualification in full.
If you plan to hold, two Lendmire pieces explain the exit: one on how to time a two-step DSCR cash-out after a hard money flip, and another on how hard money leverage compares with DSCR cash-out LTV.
Frequently Asked Questions
Does 100% financing mean I put nothing down?
Rarely. Hard money loans are sized as a share of project cost and capped by after-repair value, so you still pay upfront charges, title, insurance, and show reserves. In the network, there is no true 100% purchase program. The top tier is 93% of project cost for experienced investors with five or more completed projects, and the share steps down for borrowers with less experience, varying by lender and property.
Can a first-time flipper get a hard money loan?
Yes, at lower leverage tiers. Fewer than two completed projects lands at 85% of project cost, capped at 75% of after-repair value. Underwriting stays asset-based, looking at the property, the plan, and the exit, and approval is never guaranteed.
Do I need cash for the rehab too?
Often, for a while. Up to 100% of the rehab budget can fund, but it comes in draws against completed work. Many investors pay for early work first and get reimbursed after inspection, so keep liquid cash beyond the closing wire.
Can closing costs be rolled into the loan?
Sometimes. It varies by lender and by line item. Financing costs lowers cash at the table but raises the balance you pay interest on across a 6 to 18 month interest-only term.
What happens if I can’t fund closing?
You risk delays, a renegotiated contract, or losing earnest money, depending on your purchase agreement. Ask for a written cash-to-close estimate before you go under contract, and notify the lender and title company early if the number changes.
Planning the Next Flip
If you are buying, rehabbing or refinancing an investment property on a short timeline and want to see how the numbers work, Lendmire can help you compare hard money options based on the project, the exit plan, leverage, and your goals. Lendmire is a broker arranging financing through select lenders in its wholesale network, across 41 markets including Washington, D.C. Eligibility is reviewed lender by lender, and every file is underwritten individually.
About Lendmire
As a non-QM mortgage broker (NMLS# 2371349), Lendmire facilitates DSCR investor loans across 41 markets, including Washington, D.C. DSCR eligibility is generally reviewed around property-level rental income instead of personal income documentation, subject to lender guidelines, serving LLC-structured portfolios and self-employed borrowers who don’t fit conventional boxes. A two-time Scotsman Guide Top Mortgage Workplace (2025, 2026).
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Informational only. Not a Loan Estimate, approval, or commitment to lend. Program availability and eligibility are subject to lender guidelines, credit approval, property review, and underwriting.
References
1. Nav: Hard Money Loans 100% Financing
2. Nav: How Do Hard Money Loans Work
3. FDIC Consumer Compliance Examination Manual: Truth in Lending Act
This article is part of Lendmire’s hard money loan program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Can an Out-of-State Buyer Close a DSCR Loan If Projections Fall? · Hard Money Loan Requirements to Exit Seller Financing or Subject-to · Hard Money Overrun Documentation for a BRRRR Rehab Into a DSCR Loan
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
- Mortgage Loan Originator · NMLS# 1129696 · Verify on NMLS Consumer Access
- North Carolina Real Estate Broker · License# 343312 · Verify on NCREC
- North Carolina Insurance Producer · License# 19053198 · Property, Casualty, Life, Health · Verify on NAIC SBS
- Lendmire LLC · Firm NMLS# 2371349 · Verify firm licensure
Compliance and disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage broker and is not a direct lender, depository institution, financial advisor, or tax professional. Content in this article is general market analysis and educational information — not financial, legal, or tax advice for any specific situation. Lendmire does not guarantee loan approval; every transaction is subject to underwriting by the funding lender. Mortgage pricing and loan program guidelines are subject to change at any time without notice and vary by borrower characteristics, property type, and state regulations. Lendmire complies with Equal Housing Opportunity. Licensure verification: NMLS Consumer Access.