Fix and Flip Loans Los Angeles
Los Angeles has one of the most active fix and flip markets in the country — a function of the sheer volume of older housing stock, strong ARV values in nearly every neighborhood, and a builder/investor community that’s been sophisticated for decades. I work with LA fix and flip investors ranging from first-time flippers tackling a single Koreatown bungalow to experienced operators running 10+ projects simultaneously in neighborhoods like Eagle Rock, Cypress Park, and South Bay coastal cities.
I’m Michael DiVita, owner of DiVita Home Finance. Licensed in California since 2007. Fix and flip loans are a specialty — the right lender for a first flip in Highland Park is not the same as the right lender for a 6-month renovation in Cheviot Hills. I match the loan to the project.
How Fix and Flip Loans Work in LA
Fix and flip loans (also called hard money loans or rehab loans) are short-term financing — typically 9 to 18 months — structured around a two-part advance: the acquisition cost and the rehabilitation budget. You close on the purchase with the acquisition portion funded, then draw down the rehab budget in stages as work is completed and inspected. Total loan amounts are sized against the after-repair value (ARV) of the property, typically at 65–75% of ARV.
In LA, ARVs are high enough that the math often works in the investor’s favor. A property in Glassell Park that’s worth $900K as-is and $1.4M renovated gives an investor significant margin to work with even at hard money rates. The key is accurate ARV estimation and realistic rehab budgets — the two places where inexperienced flippers get into trouble.
Fix and Flip Loan Terms in LA
- Loan-to-Cost (LTC) — typically 85–90% of purchase price + 100% of rehab costs, subject to 65–75% ARV cap
- Term — 9 to 18 months standard, extensions available for larger projects
- Rates — 9–13% depending on borrower experience, LTV, and project complexity
- Points — 1.5–3 origination points typical
- Draw Schedule — rehab funds released in 3–5 draws tied to inspection milestones
- No Prepayment Penalty — most LA fix and flip lenders allow early payoff; confirm at term sheet
Fix and Flip FAQ — Los Angeles
I’m a first-time flipper in LA. Can I get a fix and flip loan with no experience?
Yes, though first-time flipper terms are different from experienced investor terms. Expect: lower LTC (80% vs. 90%), higher rate (often 1–2% above experienced borrower pricing), and sometimes a requirement to have a licensed contractor on the project rather than managing work yourself. Some lenders also require you to put more skin in the game on your first deal — 15–20% of project cost rather than 10%. As you complete projects and build a track record, terms improve significantly. Call me before you have a deal under contract — I’ll introduce you to the lenders who work with first-time flippers and tell you exactly what you need to bring to the table.
How is the ARV determined on a Los Angeles flip project?
The lender orders an appraisal that values the property in its improved condition — what it would be worth after your renovation is complete. The appraiser looks at comparable renovated sales in the neighborhood (usually within 0.5 miles and 6 months). In LA, where comparable sales can vary dramatically by block, neighborhood perception, and school district, getting the ARV right is critical. I’ve seen deals fall apart because an investor used optimistic ARV assumptions that the appraisal didn’t support. Before you buy, run your numbers conservatively — 90% of your estimated ARV — and make sure the deal still works at that level.
Which LA neighborhoods are best for fix and flip right now?
The most active and consistent flip markets I see in LA are neighborhoods with strong renovation demand, predictable ARVs, and acquisition prices that still leave margin: Eagle Rock, Glassell Park, Highland Park, Cypress Park, and El Sereno in the Northeast; Inglewood and Hawthorne in the South Bay as they continue to appreciate post-SoFi; and pockets of the San Fernando Valley like North Hollywood and Van Nuys where rents support strong resale. Beach communities like Mar Vista and Culver City work but the margins are thinner because acquisition costs are high. Call me when you have a specific deal and I’ll give you my read on the ARV and whether the numbers work.
Talk to Michael Directly
DiVita Home Finance | Marin County, CA | Licensed since 2007. DRE #01818285 | NMLS #323700.
💬 Text: (310) 849-9124
