Rhode Island Fix and Flip Loan
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Last Updated: April 14, 2025
Are you prepared to dive into Rhode Islandâs vibrant real estate arena? Whether you're renovating homes in energetic neighborhoods like Providence, Newport, or Warwick, or seizing opportunities in scenic coastal communities such as East Greenwich and Westerly, OfferMarketâs Fix and Flip Loan Program is crafted to transform your creative investment ideas into rewarding projects. Our financing is fast, reliable, and competitively priced, designed to support the acquisition and improvement of residential properties for both newcomers and experienced investors.
Letâs break down how our Rhode Island program functions, why now is an opportune moment to invest, and how our tailored financing can drive your next successful project.
What Is a Fix and Flip Loan?
A Fix and Flip Loanâsometimes called a "hard money" or "bridge" loanâis created to fund the purchase and rehabilitation of properties, with the goal of selling them at a profit or converting them to rental units. At OfferMarket, your financing package is made up of two main parts:
Initial Advance: Funds up to 90% of the purchase price are sent directly to the title company during closing.
Construction Holdback: Up to 100% of your renovation expenses, paid out incrementally as work is completed.
The real advantage is that you can choose your exit routeâwhether that means a rapid resale for a profit or establishing a long-term rental. In today's shifting market, having a flexible exit strategy is key to achieving success.
Why Rhode Islandâs Real Estate Market Is Ideal for Fix and Flip Projects
Rhode Island marries urban excitement with coastal tranquility. From the lively pulse of Providence and Newport to the relaxed pace of smaller coastal towns, the Ocean State offers a wealth of opportunities for property investors. Consider these attractive features:
Strong Economic Base: With booming sectors such as healthcare, education, tourism, and maritime industries, Rhode Islandâs economy fuels a steady demand for upgraded homes.
Expanding Rental and Resale Demand: A continuous stream of new residents, professionals on seasonal assignments, and vacationers enhances the market for high-quality rental and resale properties.
Diverse Property Choices: Whether itâs an elegant single-family home nestled in a historic district, a duplex in a trendy urban area, or a multi-unit coastal building, the varied inventory meets the needs of both novice and veteran investors.
No matter if your focus is on urban properties in Providence or scenic coastal flips along the shoreline, OfferMarketâs Fix and Flip Loan Program is your stepping stone to success in Rhode Island.
What You Get with Our Fix and Flip Loan Program in Rhode Island
Below is an in-depth look at what our program offers. Every detail has been structured to give you a clear picture, so you can proceed confidently with your project.
1. Loan Amount Details
| Criteria | Details |
|---|---|
| Minimum Loan Amount | $25,000 |
| Maximum Loan Amount | $2,000,000 |
| Determination | Loan amounts are based on your purchase price, rehabilitation budget, and the ARV (After Repair Value) of the property. |
2. After Repair Value (ARV) Requirements
Minimum ARV: Set at $100,000 to ensure projects remain profitable.
Maximum Loan-to-ARV (LTARV): Up to 75%, with adjustments made according to investor experience (70% for more challenging renovations or for newer investors).
ARV Calculation:
We calculate the ARV using professional appraisal reports or our in-house valuation methods to accurately gauge your property's post-renovation worth.
3. Funding Breakdown
| Funding Component | Details |
|---|---|
| Initial Advance | Up to 90% of the purchase price (80% for those just starting, 90% for seasoned investors). |
| Construction Holdback | Up to 100% of your rehab expenses, disbursed via our online draw request system. |
| Down Payment | A minimum payment of $10,000 is required for properties priced under $100,000. |
| Draw Schedule | Highly flexibleâno limits on the number of draws. For example, if materials are delivered but installation is pending, you may receive up to 50% funding for those costs. |
4. Interest Rate and Fees
| Fee Type | Details |
|---|---|
| Interest Rate | Determined by market conditions and tailored to each specific deal. |
| Origination Fee | Ranges from 1.5% to 2 points, with a minimum fee of $2,000. |
| Additional Fees | Includes a draw fee of $270 per request, a $30 wire fee, plus appraisal expenses, which are borne by the borrower. |
| Interest Accrual | For loans under $100K, interest accrues on the full loan amount; for larger loans, interest accrues only on the disbursed funds. |
5. Loan Term
Standard Duration: Typically 12 months, with optional extensions up to 18â24 months for projects that need more time.
Extensions:
Extensions can add up to 50% extra time (e.g., 6 extra months on a 12-month loan).Extension Fees:
The cost is 1% for the first 3-month extension and 2.5% for an extension lasting 6 months.
6. Repayment Structure
Payment Terms: Interest-only payments during the loan term, followed by a balloon payment at the end.
Prepayment: There are no penalties for early repayment.
Recourse: Full recourse appliesâwith 51% of the borrowing entityâs value considered for purchase loans and 100% for refinances.
7. Exit Strategy Requirements
For a Sale:
- You must achieve a minimum of 30% return on investment (ROI) with at least $15,000 profit.
For a Refinance:
- A minimum Debt Service Coverage Ratio (DSCR) of 1.1 post-repairs is required.
Flexibility:
Whether you decide to flip or refinance, our program is designed to support both strategies as market conditions evolve.
8. Eligibility Criteria
| Criteria | Details |
|---|---|
| Experience | Prior experience is not a must. New investors start in Tier 1 (80% advance), with seasoned investors advancing to Tier 5 (90% advance). |
| Credit Score | A minimum credit score of 680 is required, though exceptions can be made for scores between 660-679. |
| Borrowing Entity | You must establish your venture as an LLC or Corporation. |
| Cash Reserves | Sufficient liquid assets are requiredâcovering closing costs plus 25% of your rehabilitation budget. |
9. Project and Property Requirements
| Requirement | Details |
|---|---|
| Eligible Property Types | Projects may include 1-4 unit residential properties such as single-family homes, duplexes, triplexes, quadplexes, condos, townhomes, and planned unit developments (PUDs). |
| Minimum Square Footage | For single-family properties, a minimum of 700 sq ft; for multi-unit buildings, at least 500 sq ft per unit; condos must be at least 500 sq ft. |
| Maximum Acreage | Properties may cover up to 5 acresâsuitable for urban, suburban, or coastal renovations in Rhode Island. |
| Rehabilitation Scope | We support a range of projects from light to extensive rehabilitations, dependent on investor expertise. |
10. Risk and Approval Process
Underwriting: Our team carefully reviews ARV, planned rehab scope, overall market conditions, and your credit profile to structure the ideal financing solution.
Valuation: You must provide an appraisal report or use our internal valuation system to confirm the ARV.
Approval Timeline:
Draw requests are processed within 0â2 days, with the pace of funding largely dependent on how quickly you submit the necessary documents.Default History:
Fewer than 0.5% of our loans have ever defaulted, reflecting our effective risk management and commitment to client success.
11. Support and Flexibility
Personalized Guidance: Our experienced deal advisors are available every step of the way, offering tools like rehab cost calculators and expert insights.
Project Oversight: Our app-driven inspection system ensures transparency during each phase of your project.
Custom Draws: Disbursal of funds is done on a need-to basis, with draws approved as work progresses, so you receive the funding exactly when you require it.
12. Transparency and Fine Print
Example Costs:
For a $315,000 property in Rhode Island, an experienced investor in Tier 4 might face around $26,513 in interest over 9 months along with approximately $2,300 in fees.Clear Fee Structure:
Every chargeâfrom draw fees ($270) and wire fees ($30) to any extension feesâis disclosed upfront.Special Conditions for Rural/Complex Projects:
Projects in less conventional market segments might see a 20% reduction in funding advances and require at least 3 years of investment experience.
Example: Flipping a $315,000 Property in Rhode Island with OfferMarket
Consider a practical scenario in Rhode Island:
Purchase Price: $315,000
Rehab Budget: $70,000 (a moderate renovation, roughly 22% of the purchase price)
ARV: $480,000 (based on similar local properties)
Investor Profile: An experienced investor in Tier 4 with a credit score of 720
Loan Breakdown
| Loan Component | Amount |
|---|---|
| Initial Advance | 90% of $315,000 = $283,500 |
| Construction Holdback | 100% of $70,000 = $70,000 |
| Total Loan Amount | $283,500 + $70,000 = $353,500 |
| Down Payment | $315,000 â $283,500 = $31,500 |
| Interest Rate | 10% (as per current market conditions) |
| Interest Over 9 Months | Approximately $26,513 (accrued on the total loan amount) |
| Fees | Roughly $2,300 total (including a $2,000 origination fee, $270 draw fee, and $30 wire fee) |
Profit Calculation
Projected Sale Price (ARV): $480,000
Deductions:
Purchase Price: $315,000
Rehab Costs: $70,000
Accrued Interest: ~$26,513
Total Fees: ~$2,300
Estimated Profit:
Approximately $480,000 â ($315,000 + $70,000 + $26,513 + $2,300) â $66,187
This scenario clearly illustrates how OfferMarketâs financing can yield a strong return on investment in Rhode Islandâs fix-and-flip market.
Required Documentation for Fix and Flip Loans
At OfferMarket, we make the loan process simple and efficient. Your documents are securely saved in our Loan File system for quick and hassle-free future applications. Below is the checklist required for both purchase and refinance transactions:
Purchase Transaction Requirements
| Required Document | Details |
|---|---|
| Purchase Contract | Fully signed by both the buyer and seller. |
| Credit Report | A tri-merge soft credit report for each member serving as guarantor. |
| Background Check | Mandatory for every member of the borrowing entity. |
| Track Record Documentation | Proof of prior projects or experience for each member. |
| Identification Verification | A government-issued ID such as a driverâs license or passport. |
| Entity Documents | Articles of Organization/Incorporation, Operating Agreement/Bylaws, Certificate of Good Standing, and W-9. |
| Scope of Work | A detailed plan outlining the rehabilitation budget to calculate the ARV. |
| Appraisal Report | An invoice link will be provided for the appraisal; the report is then uploaded to your loan file. |
| Bank Statements | The latest two statements from each guarantor's account (personal bank, brokerage, or retirement accounts are acceptable). |
| Letter of Explanation | If needed, for clarifications regarding large deposits, delayed payments, or other issues. |
Refinance Transaction Requirements
| Required Document | Details |
|---|---|
| Settlement Statement | Must be fully executed by both the buyer and the settlement agent. |
| Credit Report | A soft, tri-merge credit report for each guarantor. |
| Background Check | Required for all members of the borrowing entity. |
| Track Record Documentation | Proof of prior projects or experience for each member. |
| Identification Verification | A government-issued ID (driverâs license, passport, etc.). |
| Entity Documents | Articles of Organization/Incorporation, Operating Agreement/Bylaws, Certificate of Good Standing, and W-9. |
| Detailed Sunk Costs | Itemized costs already incurred. |
| Scope of Work | A comprehensive rehab budget to guide ARV calculations and project planning. |
| Appraisal Report | An invoice link is provided, after which the report is uploaded to the loan file. |
| Bank Statements | The two latest statements from each guarantorâs account. |
| Letter of Explanation | If requested, to address specific issues such as large deposits or payment history. |
Special Requirements for Loans Over $1M
For projects where the loan amount exceeds $1M (up to the $2M cap), extra guidelines apply:
| Criteria | Explanation |
|---|---|
| Experience | At least 3 completed projects are required, preferably involving similar or higher value properties. |
| Market Liquidity | There must be at least 3 comparable sales within a 2-mile radius on the MLS in the past 6 months. |
| Credit Score | A minimum FICO score of 680 is required, along with at least 5 trade lines and a credit history of 24 months. |
| Rural Designation | Projects classified as rural by CFPB, USDA, or via appraisal are not eligible. |
| Track Record | All members of the borrowing entity must present a documented history of successful projects. |
Organized documentation not only speeds up the loan process but also ensures accuracy, smoother funding, and sets you on the path to success with your fix-and-flip venture.
Why Choose OfferMarket for Fix and Flip Loans
OfferMarket is more than a lender; we are a strategic ally in your journey to build real estate wealth. With a proven track recordâa default rate of under 0.5%âwe are committed to supporting investors every step of the way. Our advantages include:
Proactive Risk Management:
We guide you with structured advice to keep every project on track.Customizable Financing:
Our loan terms are tailored to fit the specifics of your project, with competitive rates and diverse options.All-Encompassing Support:
From loan guidance to in-depth rehab planning, our experts are with you throughout your journey.Rapid Funding:
Fast approvals and quick disbursement get your project off the ground without delay.
Key Features of Our Fix and Flip Loans
| Feature | Details |
|---|---|
| Loan Amounts | Ranges from $25,000 to $2,000,000âsuited for projects both big and small. |
| High Leverage Options | Finance up to 90% of the purchase price and 100% of renovation expenses, capped at 75% LTARV. |
| New Investor Friendly | Even beginners can qualify, with more leverage available for those with proven experience. |
| Expedited Funding | Swift initial advances and draw processing within 0â2 business days to cover construction and rehab costs. |
| Flexible Loan Terms | Loan durations vary from 12 to 24 months, with no penalties for early repayment. |
| Tailored Risk Framework | Our tiered experience and rehab scope criteria help keep your projects manageable. |
| Nationwide Availability | Accessible across the United States, with local market insights tailored to Rhode Island. |
| Transparent Pricing | Enjoy competitive interest rates, fees between 1.5â2 points, and no hidden charges. |
Ready to Flip in Rhode Island? Request Your Loan Now!
Rhode Islandâs real estate market is calling for your next fix-and-flip venture. With OfferMarketâs Fix and Flip Loan Program, you gain access to the capital, seasoned guidance, and flexible terms that set your project up for success. Our efficient approval process, straightforward documentation, and rapid funding mean you can launch your investment without delay.
Take the next step by starting your loan application today, and let us help you turn your Rhode Island fix-and-flip vision into a thriving success story.
Thousands of real estate investors get value from OfferMarket every month. Membership is entirely free and includes the following benefits:
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