In the competitive world of real estate investing, liquidity is oxygen. Tying up your capital in a single property limits your ability to scale, act on new opportunities, and absorb unexpected costs. Enter the 100% financed fix and flip loan.
The Myth of "Skin in the Game"
Traditional lenders have long preached the necessity of "skin in the game"—requiring borrowers to put down 15% to 25% of the purchase price. While this mitigates risk for the bank, it suffocates the investor. Modern, aggressive capital partners like RELM understand that the asset's after-repair value (ARV) and the operator's track record are the true indicators of success, not just cash at closing.
"Scaling a flipping business isn't about how much money you have in the bank. It's about how efficiently you can turn someone else's money into equity."
How 100% Financing Actually Works
When we say 100% financing, we mean 100% of the purchase price and 100% of the rehab costs are covered. Here is the mathematical structure behind these properties:
- 01.The ARV Constraint: The total loan amount (Purchase + Rehab) typically cannot exceed 70% to 75% of the After Repair Value. If you buy deep enough, the property funds itself.
- 02.Draw Schedules: Rehab funds are not disbursed on day one. They are held in escrow and released in draws as work is completed and inspected.
- 03.Closing Costs: While the purchase and rehab are covered, investors are usually still responsible for closing costs, points, and pre-paid interest.
Structuring for Success
To qualify for zero-down terms, your property analysis must be bulletproof. Lenders look for wide margins. If a property's ARV is $500,000, your maximum allowable offer plus rehab costs should ideally stay under $350,000 (70% rule).
By removing the down payment hurdle, you can run three projects simultaneously instead of one. The ROI on infinite returns (when you have $0 of your own capital in the property) transforms a hobby into an empire.
