How a First-Time Flipper Funded a $215K Acquisition + $62K Rehab With Just $43K Out of Pocket
Sources: Small-Balance Commercial Refinance — PeerSense, Asset-Based Lending Hub
How did PeerSense solve this scenario?
~$58K profit on first flip. A 32-year-old project manager who'd been studying real estate investing for three years. PeerSense placed the deal into fix & flip with conservative leverage, asset-based underwriting, and fast execution. Composite case study based on the deals we close every month.
— PeerSense Composite Case Study · 2026-05-01
At a glance
| Acquisition | $215K |
| Rehab budget | $62K (100% financed) |
| ARV | $385K |
| Total project cost | $277K |
| Total loan | $234K (90% LTC + 100% rehab) |
| Borrower out of pocket | ~$43K + closing |
| Term | 12 months interest-only |
| Property type | 3-bed/2-bath ranch |
| Sale outcome | Closed at $379K in month 7 |
| Net profit | ~$58K |
The borrower
A 32-year-old project manager who'd been studying real estate investing for three years. He'd read every book, joined two local meetups, and built relationships with two contractors and a real estate agent who specialized in distressed listings. He had savings, decent credit (FICO 720s), and stable W-2 income — but he didn't have $277K of cash sitting around to buy the house and pay for the rehab.
He'd been told repeatedly by banks that they don't fund flips. He'd talked to two hard money lenders who told him their minimum experience requirement was 3 prior flips. He almost gave up.
Why traditional financing said no
The standard answers in the fix and flip space:
- Banks don't fund flips, period. Even if they did, they wouldn't fund the rehab work.
- Most hard money lenders require 3-5 prior flips to approve a borrower as "experienced." First-time flippers get sent away.
- Conventional loan programs require the borrower to occupy the property — which a flipper, by definition, isn't doing.
How PeerSense solved it
We placed the deal into a fix and flip program designed to accept first-time flippers with strong personal financials and a verified general contractor. The lender funded:
- 90% of the acquisition cost (LTC) — $193,500 on the $215K purchase
- 100% of the rehab budget — $62K, drawn in 4 stages tied to inspection milestones
- Capped at 75% of the after-repair value — well within bounds at this $385K ARV
The borrower brought ~$43K to the closing table for his portion of the acquisition + closing costs. He brought no rehab money because the rehab was 100% financed. His contractor was approved by the lender (resume, references, prior projects) which is what makes first-time flipper approval possible.
The outcome
- Project completed in month 6, sold in month 7
- Listed at $389K, closed at $379K
- Net profit after all costs: ~$58K
- Used proceeds to fund flips #2 and #3 simultaneously
Frequently asked questions
Can a first-time flipper qualify for a fix and flip loan?+
Yes — with the right program. First-time flippers can qualify with strong personal financials (good credit, reserves, stable income) and a verified, experienced general contractor on the project.
How much do I need out of pocket for a fix and flip loan?+
Typically **10% of the purchase price plus closing costs**. The rehab is usually 100% financed. On a $215K acquisition, expect around $40-50K out of pocket including closing.
What's "LTC" and "ARV" in fix and flip lending?+
**LTC** is loan-to-cost — the percentage of the purchase price the lender will finance. **ARV** is after-repair value — the property's projected value after the rehab is complete. Programs typically cap leverage at both: e.g., up to 90% LTC + 100% rehab, not to exceed 75% of ARV.
How long does a fix and flip loan term run?+
Most programs are 12 months interest-only, with possible extensions. The structure assumes the property will be sold (or refinanced) before the term expires.
How are rehab funds released?+
Through scheduled draws tied to inspection milestones. Typically 3-5 draws over the project lifecycle. The borrower funds rehab costs upfront for each phase, then gets reimbursed on inspection.
What credit score do I need?+
Programs vary, but most fix and flip programs accept FICO 660+ for experienced flippers and 700+ for first-time flippers. Better credit = better pricing.
What if the property doesn't sell within the loan term?+
Most programs allow extensions for a fee. Alternatively, the property can be refinanced onto a DSCR rental loan and held as a long-term rental — the BRRRR exit. ---
Have a similar scenario?
Composite case studies based on the deals we close every month. PeerSense routes to the right program + lender.
Composite case study. Names, locations, identifying details, and dollar amounts modified to protect borrower privacy. Actual rates and terms vary by borrower, property, and market conditions. PeerSense is a capital advisory firm and does not directly originate loans.